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Renters in Barcelona score major victory with new rent control law
Housing costs have jumped more than 50% in the last 5 years
As Americans grapple with how to impose rent control measures in large cities like Los Angeles and New York, lawmakers in Europe are wasting no time in addressing the problem.
Officials in Barcelona passed a new measure that requires landlords to negotiate leases based on benchmark prices that depend on the neighborhood, Bloomberg reported. The prices will be based on an area’s desirability, allowing landlords with properties in more popular neighborhoods to charge higher rent.
Rents in Spain’s biggest cities, such as Barcelona and Madrid, have been rising steadily as foreign investors buy more apartments in the area. Blackstone, for example, has invested billions of dollars in the country since the 2012 financial crash. From 2014 to 2017, rents in Barcelona and Madrid rose by 60 percent.
The rent control law comes two months after state lawmakers passed another law that caps annual rent hikes at the rate of inflation. Inflation in Spain is currently at 1.5 percent. For comparison, landlords of rent-controlled units in L.A. are able to increase rents up to 4 percent annually.
Barcelona isn’t the only European city that’s taken strides to curb rising prices. A referendum initiative known as “Expropriate Deutsche Wohnen and Co,” aimed at converting 200,000 homes into social housing has been gaining momentum in Berlin. The proposal would affect 10 companies, each of which owns at least 3,000 units in the city. [Bloomberg] — Natalie Hoberman