Rents are going up, mortgages are going up and evictions are going down. Despite the accumulation of difficulties related to paying for housing, Spain has never had fewer family evictions. Releases (the legal term for the moment in which the owner, generally a bank, recovers possession of the property) carried out in the second quarter of this year were 7,279, which represents almost a third less (-32.7 %) than in the same period last year, according to statistics published this Friday by the General Council of the Judiciary (CGPJ). If we take into account that between January and March there was already a year-on-year drop of more than 40%, the result is that in the entire first half of the year there were 13,858 evictions in Spain, 37% less than a year ago, when the data was already at its lowest. if what happened in the first half of 2020 (11,048 launches) is excluded due to the effect of the closure of the courts during the weeks of confinement due to the pandemic.
And, once again, what explains for experts the unusual data for the first half of this year (before the pandemic, no year had there been less than 30,000 evictions) is an external condition. In January, the judicial secretaries announced an indefinite strike to demand labor improvements, which extended until March. And in the following quarter, judicial officials took over with another indefinite strike. This caused the postponement of many evictions. “Many procedures were suspended,” says Natalia Palomar, lawyer for the Provivienda organization, “there has been no improvement in measures that justifies the decline.”
Palomar refers to the fact that the entry into force of the new housing law last May has not yet had effects to be reflected in the statistics prepared by the governing body of the judges. And also, remember, the new rule only extended some suspension periods for cases of vulnerable families without an alternative place to live, since the rest of the measures it contemplates were already being applied in the special legislation approved during the pandemic and the situation derived from the Ukrainian war. Therefore, it could be justified that the circumstances have changed compared to 2019, but in relation to 2022 the main difference is the strike that affected the courts, as other sources consulted also assess.
The drop in evictions has been consistent in all categories. Those derived from non-payment of rent or other problems related to leasing, which for years have represented the majority of launches in Spain, fell by 32.6% in the second quarter of the year. In absolute figures they represented 5,306 cases (that is, seven out of every ten evictions). On the other hand, 1,497 corresponded to mortgage foreclosures, which expresses a year-on-year decrease of 37%. The rest correspond to other causes and decreased by 16.2% compared to the second quarter of 2022.
Faced with these data, organizations that work with groups affected by rising housing prices do perceive an increase in the vulnerability of many families. “Many people are contacting us who were paying their mortgage, but who already have enormous difficulties,” summarizes Paco Morote, spokesperson for the Platform for People Affected by Mortgages. This organization complains that the Code of Good Practices approved by the Government to deal with situations of difficulty on the part of borrowers, and to which 98% of banks have followed, is “insufficient” because it sets too many requirements, Therefore, they believe that it has and will have little impact on the statistical series.
Also in the Tenants’ Union of Catalonia they perceive that many people “are having problems” finding apartments at an affordable price. The rise in the Euribor in the last year and a half has meant that for variable mortgages linked to this indicator (the majority) the fee has increased on average by about 300 euros per month. At the same time, real estate portals place numerous provincial capitals (Madrid, Barcelona and Valencia, among others) at maximum rental amounts.
Flexibility to negotiate
The fear, therefore, is that once the strike is over and as the months go by, evictions will increase. Although the association of financial users Asufin sends a message of calm: “The increase in the cost of variable mortgages has been very important, but the default data we have at the moment is not alarming,” says a spokeswoman. With the entry into force of the real estate credit law of 2019, the bank can only invoke the early maturity of the loan if there are at least 12 defaults and these affect 3% of the total mortgage. That is why at Asufin they ask for “flexibility” from the banks to negotiate — “the entities are not interested in keeping properties in their portfolio now either,” they reason — and to help go through a situation that they understand as temporary because “at some point the rates will have to go down to be in the environment that the ECB considers ideal, between 2% and 3%.”
Palomar, from Provivienda, observes another sign that the financial difficulties of many families have grown in the increase in bankruptcy proceedings (a procedure to request debt restructuring) by individuals, which have skyrocketed by more than 200% according to the same judicial statistics. This also takes into account the verbal possession procedures for home occupation, which increased by 2.3% compared to a year before and stood at 797 cases. However, these procedures do not reflect the entire judicial reality of the phenomenon of occupation since neither companies can benefit nor do they reflect other legal avenues that can be used to request the vacation of a home, such as criminal proceedings. What is observed is an increase of 2.5% in new cases that come to court for abusive clauses in mortgages (21,522 matters in the second quarter), while resolved cases fell by almost 20%. And what does not change is the overwhelming percentage of upholding rulings: 97.4% of the rulings were in favor of the banking client.
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