The Balearic Islands’ left-wing government has reportedly seized 56 private properties from home owners to convert them into cheap social housing.
The Balearic Islands government announced that they will be expropriating 56 empty properties from several ‘large’ homeowners and converting them into social housing on 2nd March.
In a statement released by the regional government, the left-wing coalition led by the Spanish Socialist Workers’ Party (PSEO) claimed they have been left with no option other than to expropriate the empty homes after the private owners refused to negotiate.
However, the policy has come under fire from conservative opposition parties who see it as an attack on private property rights.
The process of expropriation does not mean the government permanently seizes the properties, but instead takes control of their use for seven years after which they will be returned to their owners.
The owners of the empty homes, all considered ‘large’ property owners, will be compensated by the state.
It is believed that this comprises of private equity and investment funds.
The property owners will be compensated by the government at an average rate of EUR 391 per month which is well below the EUR 624 estimate value of the properties.
A ‘large’ homeowner, according to Balearic law, is any person or organisation that owns over 10 properties and works in the field of real estate, brokerage, property management, investment or property financing.
“The properties will be transferred to the people who need it most, taking into account that we cannot collect more than 30 percent of the owners’ income,” said the minister of mobility and housing Josep Mari.
Mari said the state will “take the flats off the market and put them in the hands of those who need them”.
The 56 seized properties are spread across three islands, 27 in Majorca, 23 in Menorca, and six in Ibiza.
The government said they will spend EUR 400,000 on refurbishing the apartments, which they claim are currently not in a suitable condition.
The compensation package received by the landlords is going to cost the government an estimated EUR 1.8 million.
The conservative Popular Party (PP) accused its left-wing counterpart of behaving like Venezuela’s former socialist president Hugo Chavez and warned that the police would drive investors away from the islands.
“The failure of public housing cannot be fixed by attacking private property rights,” declared a PP spokesperson.
The double-edged sword of a housing shortage and large numbers of empty homes is not a local issue but a national one.
A study by the Organisation for Economic Co-operation and Development (OECD) found in 2017 that there were 3,444,365 empty homes in Spain which accounted for 13 percent of all housing, one of the worst rates in all of Europe.
The owners have a 20-day window to file complaints against the expropriation of their properties.