On Friday, April 8, the Constitutional Court’s Sentence 37/2022 of March 10, 2022 was published in the BOE, declaring the unconstitutionality and nullity of certain articles within Law 18/2007 and Law 11/2020.
As we have already reported, the Catalan housing law was partially annulled for invalidating State powers. With this new sentence, articles 14, 16.1, 17 and 18 have been declared null, because the Constitutional Court considers that the powers in Catalan civil law available to the Generalitat are not enough for a legislation that must be based on the Constitution, which reserves to the State the basic legislation of civil law.
Implications of the sentence of the Constitutional Court
The articles mentioned above refer to various aspects of the Law, such as the sanctioning regime, the announcement of prices and the accreditation of social rentals or relocation of vulnerable families due to non-payment. Therefore, with the rulings it should be taken into account that:
- Rental prices are not subject to any limitation and may be freely agreed between the parties.
- The obligation to inform about the rental price reference index in advertising, offers and leases is maintained.
- Nevertheless, contracts already in force are maintained until their expiration.
Government Housing Law
Both rulings of the Constitutional Court coincide with the processing of the Government’s Housing Law, in which points similar to Law 11/2020 are raised, such as the limits on renting in tense areas.
Following the rulings, tensions have arisen that have led to the creation of an amendment proposal. The most important points of this proposal are: a tougher limit on foreclosures, the regulation of rents and the sanctioning regime. Likewise, it is demanded that large property owners allocate 30% of their properties to social renting and also, Sareb, the Asset Management Company for Assets Arising from Bank Restructuring, the 75%.
Finally, they also propose lowering the price increase threshold in order to declare a tense zone and be able to apply price controls.
Pending the final approval of the state law, if you have any questions about these latest amendments to the Catalan Housing Law, please do not hesitate to contact us so that our team of specialists in Real Estate Law can advise you on this matter.