Sociedad Pública de Alquiler changes rules, tenant rates up 18.5%

The Sociedad Pública de Alquiler (SPA) is living on borrowed time. On numerous occasions, various political groups have asked this public rental society to close. In just six months of operation, it is accumulated 30 million euros in debt. Criticism from its clients and tenants is adding up now that the SPA is changing important rules related to contracts and rental prices.

The changes, adopted unilaterally, have taken everyone by surprise, particularly families who rent. The SPA leader Nieves Huertas signed a document asking tenants to pay 18.5% more in rent or face eviction. Each tenant received the letter by email. Reasons for the rate increase were chalked up to "new market prices" calculated by the SPA. "We do not understand how this administration could want to drive profits during a time of crisis, more so now that rental prices have dropped," said one of the affected tenants. Since the SPA finalized the new contract and insisted that the markets has already started to recover. Further, they admitted that the increase will still leave rent prices 36% beneath market value.

Owners also feel unhappy and betrayed, because the SPA has stopped paying rent on unoccupied units by deleting this provision from a contract that had assured they would cover the cost. The provision was a key inventive for owners. The shift is from guaranteed rent to rent with qualifications. But on this occasion, on the contrary, it has encouraged a price drop to adjust to a market that is in crisis.