An EsadeEcPol report proposes a public rental guarantee to help tenants who face strict financial screening when trying to rent a home. Economist Ángel Martínez argues that making the guarantee available before a lease is signed could help applicants with fewer resources compete for housing, while protecting landlords against unpaid rent.
The proposal is inspired by France’s Visale programme, under which the state guarantees eligible tenants and compensates landlords for rent arrears, up to a limit of 36 months, as well as related legal costs. The administration then seeks to recover the debt from the tenant. Martínez says this would shift the risk that currently influences landlords’ choice of tenants to the public sector, without reducing protections for people who already have a contract.
A key difference from Spain’s existing government guarantee scheme is when the support would be available. Martínez’s proposal would allow tenants to present the guarantee during negotiations. The government scheme, introduced by royal decree in January of the previous year, is designed to compensate landlords after non-payment and also covers damage to the property and unpaid utilities.
The report would make the guarantee available to all people aged 18 to 30, whether studying or working, and to people over 30 whose income is no more than 1.1 times the minimum wage—about €16,600 gross a year. The current government scheme is aimed at people under 35 and vulnerable groups.
The proposed guarantee would also have rent caps: around €620 a month in municipalities with fewer than 100,000 residents, €710 in larger municipalities, €1,090 in Madrid and €1,140 in Barcelona. Rent could not exceed half of a tenant’s net income, although students would be exempt from that condition because they often have no income of their own.
Martínez estimates that nearly 12.9 million people could meet the eligibility rules if they decided to move into rented housing, based on 2023 Household Panel data. The report’s estimate of those who both qualify and move each year is about 519,000. It distinguishes that pool of potential applicants from the number of guarantees that would actually be issued, assuming the programme expands gradually at a pace similar to Visale.
Under that scenario, the scheme would cover about 4.8% of new rentals among potential beneficiaries in its first year, issuing roughly 29,000 guarantees. By the fifth year, annual coverage would reach around 146,000 contracts. About 440,000 guarantees would be issued over the first five years. The estimate assumes an arrears rate similar to Visale’s, where around 6.5% of contracts accumulate debt over a three-year period.
The report estimates that the guarantee would cover unpaid rent for around 540 households in its first year and about 4,000 in its fifth, or roughly 11,300 families over the first five years. Average arrears would be about €2,550 per household, which the scheme would pay to landlords within weeks before seeking repayment from tenants.
After accounting for money later recovered, the net cost to public finances is estimated at about €50 million over five years, within a range of €45 million to €60 million. Annual spending would rise from roughly €2.8 million in the first year to €17.5 million in the fifth. More than half of the cost would come from rent arrears and legal expenses covered by the guarantee, with the remainder going toward administration.
Sources: El País Economía.