IEE warns: Spain is one of the least respectful of private property in the OECD

The Institute of Economic Research (IER) warns that Spain is among the Organization for Economic Cooperation and Development (OECD) countries where private property is least respected. Our country ranks 26th out of 37 countries considered, below the OECD average.

According to the organization, the results of the International Property Rights Index (IPRI), compiled by the Union for the Defense of Property Rights, show that the guarantee of property rights in Spain is 6.1% less than the OECD average. The difference widens when comparing Spain's results with the best countries, decreasing by 19.5% compared to Switzerland, which performed better in 2021. This situation is repeated in the three''the main indicators (legal and policy environment, tangible property and intellectual property) that determine the index. Spain ranks below the OECD and EU average, with notable gaps compared to the best-performing economies, according to the IEI. The only exception is Spain's better performance in property registries, where it ranks seventh in the world, and in patent protection, above the average of OECD countries. According to the IEI, this index confirms the close link between stronger and better protection of property rights and higher levels of economic development and prosperity. Thus, the countries with the best results in the IPI are those that best protect rights''private ownership, have higher GDP per capita, lower levels of poverty, greater competitiveness, and higher rates of innovation and lower levels of corruption. In fact, the IEI notes that the average GDP per capita in countries at the top of the IIPS world rankings is 19 times higher than the worst performing countries on this measure. If the International Property Rights Index is calculated taking into account the impact of property taxes, the average OECD score would fall by 5.6%. In the case of Spain, this decrease would be 7%, which, according to the Institute, indicates that "the taxation regime in Spain has a more negative impact on property compared to other countries".

The law on''future Housing Act, create "uncertainty and legal ambiguity" and are "ineffective and counterproductive" to improving access to housing.

In this context, the IEI cites examples of rent price controls in other countries (San Francisco, New York, Boston, Stockholm, Paris, Berlin) and points out that at best "there is little or no short-term rent control in the regulated area," which tends to focus on higher-priced rents, "and always at the expense of shifting the tension to''unregulated part of the market and creating a serious reduction in the supply of rental housing'." In Spain, the IEI mentions rent price controls in Catalonia, concluding that "this has not only led to a significant reduction in the supply of rental housing, but has also led to counterproductive dynamics that should serve as a warning of what a future government regulatory framework could mean. "

The illegal occupancy of housing

At the same time, the IEI considers "alarming" the "increasing legitimization" and "tolerance" of illegal housing occupancy in the Spanish legal field, "which denies the essence of the legal right to property and aligns it with criminal activity in most cases." "Such tolerance of regulation s''The phenomenon of illegal occupancy and violation of property rights is inappropriate for a developed society and deeply destroys our institutional framework, with all the negative consequences in economic terms that this entails. By defending this criminal activity, Spain becomes a unique case among its comparable partners," states IEI.

In IEI's opinion, the new Housing Law represented an excellent opportunity to combat the problem of illegal occupancy and prevent the rise of appeals to the Constitutional Court on the housing laws of the Autonomous Communities. "However, this is a missed opportunity as these questions were not asked or developed in the future regulatory framework. Moreover, the draft Law recognizes the right to temporary''suspending eviction and other repossession proceedings for four months of the occupants of the dwelling unit, with or without right,' he concludes.