Spain’s Housing Crisis Is a Concentration Crisis

In Adam Smith’s famous model, competition ensures that supply meets demand. Does that hold when the good in question is a basic human right: adequate shelter?

The neoclassical utopia does not seem to apply in the EU’s housing sector, where prices surge “well ahead of household incomes”. In Spain, rents in 2024 were 80 per cent higher than in 2014, and the house-price index had risen 63 per cent. Newly let homes in 2024 commanded 16.6 per cent above the average rent of existing properties, compared with 6.2 per cent in 2020.

Conservatives claim the solution is to build more houses. Alicia del Río of Spain’s Tenants’ Union counters: “construction, yes, but only after regulating rent prices”, because “supply has been hijacked by investors”, a rentier class that speculates and drives up prices. Only 4.9 per cent of the population receives any rental income.

The data suggest that concentrated ownership and speculation animate the housing crisis. And a chronic shortage of construction workers stands in the way of any building boom.

The crisis was dramatically indexed in September 2026, when Maricarmen Abascal, a disabled 87-year-old, was evicted from the Madrid home she had lived in for 70 years. A massive demonstration followed under the slogan “Not one more Maricarmen”. Protests have since erupted across Spain.

The government responded with two decrees: preventing evictions of vulnerable households, extending some contracts and limiting rent increases, restricting purchases by vulture funds, and setting new rules for seasonal rentals. The conservative People’s Party, the far-right Vox, and the right-wing Catalan pro-independence party Junts rejected the decrees in Congress, and Prime Minister Pedro Sánchez called a snap election. After dissolving parliament, he re-approved revised decrees on 6 October; they must be ratified within 30 days by the legislature’s standing committee (Diputación Permanente), where the government believes it has the votes. The next day, Maricarmen died in hospital.

Large Landlords Tighten Their Grip

Housing figures vary with the source, the method, and the segment of the market measured. The Ministry of Consumer Affairs, the non-profit newsroom Civio, the cadastre, and the Instituto de Investigación Urbana de Barcelona (IDRA) all show substantial concentration among higher-income landlords and corporations. The Bank of Spain emphasises small owners, albeit with significant concentration.

Differing estimates make the level of concentration hard to pin down. The Ministry of Consumer Affairs says that small landlords with a single rental property control only 39 per cent of rented homes, while 52.8 per cent of the homes let by individuals belong to landlords with two or more rented properties. The figure from the Bank of Spain is similar: 49.3 per cent of main-residence rentals. Civio found that, in the eleven regions for which data exist, corporate groups with at least 50 rentals controlled 10 per cent of the rental market, half of them US banks and investment funds.

The Right to Housing Act 12/2023 defines large landlords as those owning more than ten urban dwellings. Between 2014 and 2024, their number rose 20 per cent. Cadastre data for 2025 show that private companies owned 1.08 million homes, around four per cent of the residential stock outside the Basque Country and Navarre. Just five per cent of those firms held 52 per cent of company-owned homes, while 563 companies with more than a hundred properties each held about a quarter of the corporate stock.

Speculating with what should be a universal right, they sell far more than they buy. These are no paupers: most recent purchases were made without mortgages. The data show that housing is increasingly held as a financial asset.

The Bank of Spain emphasises constraints on supply. It estimates that completed dwellings fell about 750,000 short of net household formation between 2021 and 2025. Yet in 2020 Spain was among the eight OECD countries with the most homes per inhabitant: more than 500 per 1,000. The problem? Some 3.8 million lay empty, 14 per cent of all dwellings in 2021.

Valeria Racu, a spokesperson for the Tenants’ Union, puts it bluntly: “construction without new rules of the game is like turning on air conditioning and leaving the windows open. Construction for whom? So homes can be bought by overseas investors? Apartments for tourists?”

Spain also has one of the smallest public housing stocks among advanced economies, and few leases are protected by old or social rents. To make matters worse, public housing has been sold off to vulture funds or dubiously allocated.

Foreigners account for almost a fifth of home purchases, and seasonal rentals have soared, alongside the 351,000 dwellings listed on tourist platforms in early 2024. Olga Rodríguez, a journalist at elDiario.es, speaks of “predatory real estate colonialism”.

When the private equity giants Blackstone, Cerberus, and Lone Star bought up more than 400,000 Spanish homes in the past decade’s largest megadeals, they barely dipped into their own reserves, relying instead on low interest rates. Their Spanish subsidiaries often answer to parent structures in Luxembourg, the Netherlands, the Cayman Islands, or Delaware: a textbook case of what Michael Goldman calls the Hidden Empire of Finance.

Who Profits From Eviction

In the first quarter of 2026 there were up to 45 evictions a day. The number is debated: many cases are still contested in the courts, while many more renters are forced out informally, by unaffordable rent increases or the non-renewal of leases.

The day before Maricarmen’s eviction, the regional president, Isabel Díaz Ayuso, opened The District, Spain’s largest property fair, and while activists were trying to stop the eviction, officials from her government were meeting investors there. Ayuso and her colleagues meeting the rentier class at such a moment recalls Adam Smith’s warning: when “people of the same trade” meet, the result is a “conspiracy against the public, or … some contrivance to raise prices”.

The hypocrisy is stark: conservatives panic at the thought of expropriating housing from vulture funds, even as they expropriate land to build data centres.

Fernando de los Santos of the Tenants’ Union puts it this way: the housing protests are “rebalancing the power imbalance”.

Or, in Maricarmen’s words from her hospital bed, “I didn’t succeed in defending my home, but I fought so others learn to fight for theirs”.

The Economist, which named Spain the best-performing rich economy of 2024, routinely writes about the Spanish economy in glowing terms.

If wealth were distributed reasonably and equitably, the housing crisis might not be so severe. But a quarter of Spain’s population is at risk of poverty or social exclusion, the highest share in Western Europe apart from Greece.

That inequality, and an irrational capitalism, produce crises like the one we see today. As The New York Times summarised it: “Spain built too much in the 2000s because of a housing bubble. When the bubble popped during the financial crisis, prices cratered and the country became reluctant to build new housing. Then, to revive the market, Spain made it easier for landlords, companies and foreign buyers to buy in”.

The Spanish rental market is not a pure monopoly, but its ownership is deeply skewed: multi-property landlords control around half of the rental homes owned by individuals, while a small group of corporate mega-landlords distorts the private market.

Their impact on Spanish society is pernicious.

As Adam Smith himself held, democracy must intervene: “the natural liberty of a few individuals, … [who] might endanger the security of the whole society … ought to be … restrained by the laws of all governments”. The people agree: 76.3 per cent want the state to intervene to ease the housing crisis.

Average annual returns on rental housing, 10.8 per cent between 2015 and 2022, beat those on government bonds, bank deposits, and even the IBEX-35 stock index, helped by short-term contracts and exemptions from corporation tax. Immediate action by national and local governments is needed to protect everyday renters.

The objective of public policy should be to prohibit the speculative use of housing, or to limit it through heavy taxation. Governments should listen carefully to the protestors, who propose a “Maricarmen Decree” with measures such as protection against evictions without cause, a freeze on current rents, automatic contract renewal, and tighter controls on seasonal and room rentals.

The snap election this crisis has forced will say a great deal about Spanish values. What do we hold dear? Maricarmen, or Blackstone?