How are housing competences divided in Spain?

On January 18, 2022, the Spanish Central Government wanted to pass the new housing law. This will has been stopped by the General Council of the Judiciary, which has rejected the mandatory report because it considers that the Autonomous Communities, such as Catalonia, are competent in the matter. At Finques Feliu, we take advantage of this episode to explain the current distribution of competences in housing policies.

1. Introduction: the institutional architecture conditions the effectiveness of policies

a) Unitary States: pure or deconcentrated

First of all, there are pure unitary States where the central State reserves for itself the direction of all policies.

On the other hand, there are deconcentrated unitary States where the State chooses to recognize the existence of administrative entities with administrative but not political power.

b) Decentralized States

In states where different levels of government share power, the central state recognizes, not without tensions, that, to be effective, it needs to decentralize policies and services.

At this point, the "subnational" units add to the mere administrative function they have in a centralized state the political power that characterizes decentralization. In this second group, Spain is a strong decentralized state.

2. The distribution of housing competences in Spain:

Once we are clear about what type of State we are in, we can explain the distribution of competences in housing policy.

a) Municipal competences: Spain has 8,131 municipalities (947 in Catalonia). The powers that municipalities can determine in housing are established in the Law of Bases of Local Regime. This regulation grants to the local power the following competences: "urban planning, management, execution and discipline; promotion and management of housing; parks and gardens, paving of urban public roads and conservation of roads and rural roads".

b) Exclusive powers in housing of the Catalonian governement: in relation to the exclusive powers, for all purposes, Article 110 of the Statute specifies that the Government has: "legislative and regulatory powers and the executive function".

Article 137 is the heart of the Generalitat's competencies in housing. These are the following:

- The planning, arrangement, management, inspection and control of housing in accordance with social needs and territorial balance.

- The establishment of priorities and objectives of the promotional activity of the public administrations of Catalonia in the field of housing and the adoption of the necessary measures to achieve them, both in relation to the public and private sectors.

- The public promotion of housing.

- The administrative regulation of the housing trade and the establishment of protective and disciplinary measures in this area.

- Technical standards, inspection and control of construction quality.

- Standards on the habitability of housing.

- Technological innovation and sustainability applicable to housing.

- The regulations on conservation and maintenance of housing and their application.

Source: "Title IV: Of the competences (articles 110-173)".

Apart from Article 137, there are others with aspects that affect this field.

Article 147, the Catalan governement (hereinafter Generalitat) reserves for itself "the appointment of notaries and registrars of property, mercantile and real estate, by means of the announcement, administration and resolution of open and restricted competitions(...).

Article 149, which attributes to the Generalitat, "the planning of the territory, the coastal landscape and town planning".

Within this extensive article there are exclusive competences that promote the conditions for a housing policy with an impact on the territory.

Firstly, "the establishment of guidelines for planning and management of the territory, the landscape and the actions that affect it".

Secondly, we consider that of all the exclusive competences listed the most clearly linked to housing is "land and housing policy, the regulation of public land and housing assets and the regime of administrative intervention in building, urbanization and the use of land and subsoil."

Finally, "the protection of urban planning legality (...) urban planning inspection, orders for the suspension of works and licenses, measures for the restoration of altered physical legality (...)".

c) The Central State: Spanish Constitution, beyond the famous article 47, which establishes the non-justiciable right to decent housing, makes no more explicit references to this issue.

In article 131, however, a very extensive reading could be understood that housing is not included in the "planning policies of the economic activity (...)" that it prescribes. To conclude our analysis, which anyone can verify in the Constitution, we underline a decisive fact: in article 149, which establishes the list of exclusive competences of the State, there is no housing policy.

From the contrast between the broad competences of the Autonomous Communities and the non-existent competences of the State, an unavoidable question arises: Can the State legislate on housing policy?

At Finques Feliu we believe, as do the majority of the General Council of the Judiciary in their recent vote, that the State cannot currently legislate on the basis of an alleged exclusive competence in housing.

If there were an exclusive competence, it would undoubtedly empower the central power to legislate on housing. However, from the careful reading of the Spanish Constitution that we made, this cannot be deduced. The Spanish Constitution is the only framework in which the State can legislate by invoking its competence.

Finally, the invocation of the "sovereignty" of the State to justify housing legislation is also unclear. The sovereignty of the State exists, but in the Spanish legal system it is not a guarantee to legislate on a matter where the State is not competent.

We would like to have shed some light for our clients and the real estate sector as a whole.