🚨 Welcome to Props — The Bubble's real estate newsletter. You're here because Spanish real estate is fascinating, insane, occasionally enraging, and — if you have a little money and play it right — profitable. Every week we bring you the data, the deals, the people making it happen, and the ones making it worse.
So sit back and enjoy! And send your tips, comments, suggestions, and all-cash offers to ian@thebubble.com.
The Balloon Effect
Nuts. Wacko. Cray-cray. However you cut it, the housing market in España has lost the thread. No one (except the very rich) can afford anything where you want to live; finding a rental without knowing the guy behind the guy behind the guy is almost impossible; and the stories of doormen getting €50,000 commissions for tipping off investors when a resident dies? We just can’t.
But seriously, folks. The slushy blend of politics and economics that is the housing market is the story of what policy wonks call the “Balloon Effect”. That’s when a law or a suddenly changing situation displaces the original issue to somewhere else, like squeezing a balloon causes air to bulge out in a different spot.
Legislate a rent cap? Landlords shift to short-term rentals. Demand that builders set aside 30% of units for affordable housing? In Barcelona, new building permits fell almost 80% in five years. Housing prices spike in the city center? People move to the edges (though as we noted last week, that’s not so easy anymore.)
This week we’ve found three examples of how Spain’s effervescent housing market has pushed local residents into pretty creative — and drastic — solutions. Squeeze the housing balloon and one bulge goes down, another out, and the third sideways.
Let us count the ways:
