Spain struggles to contain housing crisis as prices surge 13% annually and residents face displacement

Thousands of Spaniards took to the streets of Madrid in May. Young people, teachers, professors—all unable to afford a flat. Despite economic growth, wages have failed to keep pace with rental costs. One protester remarked: "We are offered only price increases and eviction."

Pedro Sánchez's government has allocated €7 billion for state-funded housing construction over four years. Yet this falls short of requirements—the country faces a shortfall of 700,000 flats. The core issue: tourist apartments have colonised city centres (Spain received 97 million foreign visitors last year), displacing local residents. A decree to freeze rental prices failed to pass parliament.

The housing crisis represents a political minefield for Sánchez ahead of the 2027 election. Spain has a strong tradition of homeownership, but state housing stock is virtually non-existent. The consequence: young people remain living with grandparents whilst protests intensify.

Source: Hurriyet Daily News Economy