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The Dramatic Residential Insecurity in Spain in the Context of the European Union

By Juan A. Módenes

Residential insecurity is a threat to the life plans of young European households. It is therefore interesting to ascertain the present situation of households by focusing on the perceptions and opinions of those most concerned. The latest 2016 edition of the European Quality of Life Survey (EQLS) produced by Eurofound offers material for exploring the opinions of households about the short-term (six months) security of their housing.

This is the subject of a study carried out by Juan Antonio Módenes for the online publication Perspectives Demogràfiques, which is published by the Centre d’Estudis Demogràfics. This study analyses the high degree of residential insecurity in young Spanish households in relation to the recent rise in rent and the entrenchment of social and occupational precariousness. It confirms that residential insecurity is felt across the board of social groups and highlights the negative singularity of the Spanish case in the European context. There can be no doubt about the detrimental effects of residential insecurity with regard to the life plans of young households, among them having children, and hence the relevance of the demographic viewpoint regarding this situation.

In 2016, 38.3% of Spanish households perceived some degree of risk of losing their homes. This figure brings to light a serious structural situation in the Spanish housing system. On the European scale, the figure stands at 24.1%. Looking at Spanish households headed by under 45-year-olds, who should be deciding their long-term life plans, the figure for perceived residential insecurity skyrockets to 53.9%, which is a much higher than the figure of 32.7% for young European households.

Young people + rent = insecurity

There are two factors which make it easier to understand the difference between Spain and the rest of the European Union in relation to young residential insecurity: 1) The greatly increased weight of private renting, which is the least secure form of tenure, and 2) the excessive structural residential insecurity, independent of the type of housing.

About 40% of young Spanish households are renters, most of them at market prices, while the European average is lower than 30%. Rent-related residential insecurity is much greater than it is with any other kind of tenure, including mortgaged home ownership. EQLS data show that more than 80% of young Spaniards in private rent perceive residential insecurity. Moreover, 70% of young insecure households are private renters. This virtually means that there is endogeneity between renting and residential insecurity in these young households.

Furthermore, in each type of tenure, the levels of residential insecurity are higher in Spain than in the European Union as a whole. In other words, residential insecurity is a structural feature throughout the Spanish housing system. The difference is greater with forms of tenure that entail a bigger burden of regular payments, mortgaged home ownership and, in particular, private rent. Only Italy comes near the situation in Spain, but Italy has fewer young households living in rented accommodation.

Figure 1. Perception of insecurity in young households (<45) by country in accordance with whether they are paying market rent or have some other form of tenancy

Source: Author, using the European Quality of Life Survey 2016

Bursting the bubble of residential insecurity

Housing insecurity is no longer limited to the more socially and occupationally vulnerable households. Hence, the study indicates that this phenomenon is a transversal experience across the whole society. In socially at-risk households, the concepts of vulnerability, renting and housing insecurity are almost indistinguishable. Approximately 64% of young households at risk of poverty or exclusion are paying market rent and, of this group, more than 90% perceive insecurity with regard to their housing. Furthermore, although mortgaged home ownership is the main category among non-vulnerable young households, 33% are paying rent and, in this group, 72% feel their housing is insecure.

In brief, urgent measures need to be taken in order to limit the insecurity resulting from rising private rent in the Spanish housing system. Recent measures proposed by the Spanish government have moved in this direction, among them changing the minimum period of rent contracts from three to five years, and expanding legal safeguards in cases of eviction when there is evidence of vulnerability. Establishing measures to limit the cost of rent in certain urban areas would also be appropriate. It is to be hoped that additional and more thorough moves will be made in this direction. Given that renting is here to stay, any change in the institutional setting to reduce housing insecurity could have a major positive impact on the advancement and consolidation of life plans developed by young people.