The “revolt of the keys” has started, says the Tenants’ Union. But what chance of success does it have?
Let’s begin with a little trip down memory lane to an event that has largely been forgotten in the annals of history.
In 1931, the Confederación Nacional del Trabajo (CNT) called a rent strike in Barcelona. It would be one of the biggest in history, with over 100,000 participants — in a city of around a million inhabitants. The reasons for the strike were myriad. During the late 1920s hundreds of thousands of migrant workers had flocked to the city from other parts of Spain to help construct the buildings and infrastructure projects of the 1929 Great Exhibition, including the city’s metro network. But by 1931, with the exhibition long finished and the Great Depression in full flow, 40% of the population was unemployed.
Many could not afford to pay rent. Overcrowding was a serious problem, particularly in the so-called Casas Baratas (Cheap Houses) in the neighbourhoods of Bon Pastor, Can Peguera, Ferrer i Guardia and Baró de Viver. Within a month, 100,000 members of the working class had joined the strike. The Republican government, still in its infancy, responded by unleashing a brutal crackdown of the movement, resulting in 18 deaths and dozens of injuries and arrests. Yet despite official, forced and real evictions, many families remained in their flats, largely due to coordinated strategies adopted by the striking tenants. From Wikipedia:
The start of the strike was followed by a huge wave of evictions, forcing the workers to create a resistance fund to meet the payments of people without income. Strategies were also developed to make evictions more difficult, such as bringing furniture back into the house with the help of neighbours as soon as it began to be taken down to the street by the evictors. The neighbourhood organisation of Ferrer i Guardia was particularly strong, led by women such as Victoria Ruiz Rodríguez and Dolores Maldonado Ruiz, who managed to stop evictions, find alternative housing and create neighbourhood support networks despite the harsh response of the Chamber of Property and the Housing Board.
The strike ended in December of the same year, six months after its inception, following the imprisonment of the CNT-created committee. However, as Wikipedia notes, it remained active intermittently during the following year, giving rise to various agreements with small owners for a reduction in rent prices — small gains in return for great sacrifice.
Rent strikes have been around for centuries. According to Wikipedia, “some of the earliest evidence of collectively withholding rent comes from the 15th century, where it was noted in arrears lists as quia tenentes negant solvere, (lit. ‘because the tenants refuse to pay‘)”. As cities industrialised and urbanised in the late 19th and early 20th centuries, rent strikes began to occur in countries as far and wide as Chile, Mexico, Argentina, the United States and Canada. Yet few reached the scale and length of duration of Barcelona’s 2013 strike.
Now, history is repeating. Last week, just days after The Economist magazine revealed its choice for best performing OECD economy of 2024 was Spain, the Catalonian Tenants Union announced that more than two dozen families in the coastal city of Salou, just over an hour’s train journey south of Barcelona, had gone on rent strike. Clearly not everyone is benefiting from Spain’s recent uptick in economic growth. Indeed, it could be argued that many are suffering from the externalities of that growth (more on that later).
“A Two-Month Strike”
On Monday, December 9, “29 families from the social housing developments managed by La Caixa (Inmocaixa)” began a “two-month strike”, which involves the return of the “receipt of the last two monthly payments of the year,” said Enric Aragonès, a spokesman for the union, adding that “The… revolt of the keys” has started.
Of the 29 families that have gone on rent strike, 23 are living in a development in Salou. Together, they occupy 62% of the building’s apartments. Another six families are from a Caixabank-owned estate in El Vendrell.
“The joint non-payment adds up to around €20,000 euros,” said the Tenants’ Union, adding that “the collective action comes after a Supreme Court ruling declared it illegal to charge tenants of subsidised housing with IBI (a business tax).” According to the union, Caixabank, Catalonia’s largest lender and Spain’s largest landlord with an estimated 22,000 properties on its books, has collected more than €10 million in illegitimate IBI payments in Catalonia alone. The union is calling for the reimbursement of these illegally obtained funds.
It’s not clear how far or wide this rent strike can grow, but there is clear potential for it to became a nationwide phenomenon. Given that many of the problems faced by Spanish tenants are commonplace throughout Europe, it could even inspire other movements in other parts of the old-continent. According to 20 Minutos, 23 households in two subsidised housing developments in the town of Sentmentat, a small town just north of Barcelona have agreed to join the strike from 1 March. Both developments are managed by the same same Caixabank-owned developer.
The problems affecting the tenants in Salou and Sentmentat — in particular that of soaring rents that are increasingly unhinged from the average salaries of local tenants — are commonplace throughout Spain. As a recent report in El Confidencial documents, while these problems are common to all developed countries, they are particularly pronounced in Spain, in large part due to the country’s low wages and the unfettered financialisation of housing after the Global Financial Crisis:
Houses have become a very profitable speculative asset in all countries, which has fuelled investor interest, driving prices to levels that are unaffordable for most of the population… Spain is one of the worst countries in the world when it comes to access to housing.
This is highlighted in a special issue of the International Monetary Fund magazine that is dedicated exclusively to the real estate market. Spain might not have seen the sharpest housing price rises, but the low wages and high unemployment have compounded matters — especially in the case of young people, who continue to suffer from severe job precarity.
To begin with, public perception [of the housing market] is worse in Spain than all other OECD countries. Eighty-five percent of 18-29 year olds believe they will not be able to find or maintain adequate housing. This pessimism is much more widespread than in the euro area as a whole, where the percentage is 60%, 25 points lower.
The situation is also dramatic for the rest of the working population. Between the ages of 30 and 54, 75% of the population believes that they will not get adequate housing, also the worst figure in the OECD. The average for developed countries is 50%. These data show the magnitude of the social impact of the housing drama in Spain. Only in the age group of workers over 55 years of age is this concern reduced to 60% of the population. Even so, these figures are still worse than in the OECD, with a gap of just over 10 percentage points.
As another article in 20 Minutos notes, Spain is split between those who accumulate property and rental income, and those who, even with stable jobs, do not have the resources to access a home of their own and even struggle to survive as tenants. The financialisation of housing that has driven a large part of the recent surges in housing demand and prices is one of the most pernicious aspects of the financialisation revolution, as my former WOLF STREET colleague Wolf Richter wrote a few years ago:
When housing becomes a financialized asset class, like stocks, you cannot create enough housing to satisfy investor demand because this demand is artificial and limitless since investors can always borrow more to buy more and acquisitions are spun off into financialized products traded on the stock exchanges.
This is the problem in housing. You don’t have to live in stocks. If there is a bubble in stocks, it doesn’t make life impossible for regular folks.
But that’s not the case when housing becomes unaffordable because of artificial and limitless demand by highly leveraged investors from around the world that is focused on a few cities and inflates prices into the stratosphere. This has real consequence that are… not good for the local economies.
Soaring Rents, Stagnant Wages
At the same time, the boom in tourist rentals in Spain, the world’s second largest tourism market, has deprived the long-term rental market of tens, if not hundreds, of thousands of properties. According to the National Institute of Statistics (INE), in 2023 the number of tourist apartments in Spain surged 9.2% year over year, to reach a grand total of 351,389. While that may only represent 1.33% of the country’s total housing stock, many of the tourist apartments are concentrated in markets where the supply of long-term rentals is already extremely tight.
Rents in Spain have been rising far faster than both inflation and salaries for well over a decade. In Barcelona, for example, rents have surged by 70% over the past 10 years whereas salaries have risen by just 17%. It’s not just the rents that are prohibitive; so, too, are the upfront fees and deposits tenants have to pay. Given that 40% of Barcelona residents now rent their home, the impact of this trend has been brutal.
In Madrid, more than 900 tenants spread over ten housing blocks owned by the same vulture fund, Nestar-Azora, announced a rent strike in June after the fund allegedly imposed abusive clauses in their rental contracts. These clauses have led to increases of up to 30% in the amount tenants have had to pay during the duration of their contracts, says the Madrid Tenants’ Union.
Even as the Spanish economy outperforms many of its EU peers, social unrest is on the rise. Over the summer, Barcelona was one of many Spanish cities to stage protests denouncing the social, economic and environmental impact of mass tourism. It is impossible to overstate the importance of tourism to Spain’s economy. It accounts for 15% of GDP, according to the World Travel and Tourism Council. It employs, directly or indirectly, 2.9 million people — roughly 14% of the total working population. That’s more than any other industry.
For many years, local residents of saturated locations like Barcelona, Mallorca and Malaga have complained about the toxic mix of externalities unfettered tourism brings in its wake, including sky-high prices and rents, overcrowding, noise, environmental degradation, overstretched public services and infrastructure, and the gradual formation of a mono-dimensional local economy. Many of the jobs that mass-tourism creates are of the casual, low-paid variety that vanish into the ether the moment the tourists go home.
A couple of weeks ago, thousands of people demonstrated in Barcelona, Jerez de la Frontera (Cádiz) and Burgos to demand a sharp reduction in rents as well as measures to put an end to the boom in tourist rental flats and the phenomenon of gentrification of cities caused by the mass arrival of tourists. A month earlier, it was Madrid’s turn. From La Jornada:
It cannot be that investors come to our cities and play with property as if it were a Monopoly board,explained the spokeswoman for the Tenants’ Union, Carmen Arcarazo, who pointed out thatif we unite, we have much more power than any politician or rentier.The goal is to force a 50 percent reduction in rents at the national level, promote indefinite contracts
to put an end to blackmail and insecurity at the end of each short-term contract, recover homes for residential use and prohibit speculative purchases. The message of the protest, according to this union, is that “if renters and political leaders do not lower prices, we will. So, today begins a process of tenant organisation with a clear objective in mind: people who live in rented accommodation cannot take it anymore and we are willing to go on strike if rents are not reduced by half.”
Over the last 10 years, tenants have seen how we have become increasingly impoverished by rents that grow without any justification. A small group of rich people and companies have been making money at the cost of buying and hoarding more and more houses to put them at a prohibitive price. The data are clear: in Spain, 60 percent of apartment purchases are paid in cash, without the need for a mortgage. In Barcelona, over the past 15 years, half of the home purchases have been by investors with eight flats or more.
No Country for Young Tenants
Spain’s younger generations — who are on the sharpest end of the housing problem — cannot become independent until the age of 30 and depend on family support to do so. Ironically, the right of all Spanish citizens to decent and adequate housing is enshrined in Article 47 of Spain’s 1978 constitution. Yet in large cities such as Barcelona, Madrid, Malaga and Palma de Mallorca, more and more local residents are finding that such a right no longer exists in the city they were born in.
In late 2023, a survey by Save the Children found that 23% of children in Catalonia live in families that have been evicted from their homes or are at risk of being evicted. From Time Out (in Spanish, translated by yours truly):
In the case of Catalonia, the main cause of inequality and social exclusion continues to be housing, followed by inflation, unemployment and lack of educational attainment, among other things.
Of the total number of families surveyed, one in three live in inadequate conditions and 60% cannot heat the home to an adequate temperature. In addition, 9% reside in squatted housing or are at risk of imminent eviction, the most worrying figure among all the territories analysed and which represents double the national average. As a result, close to one in four children live in families affected by, or facing the risk of, eviction.
At the turn of this century, Spain had one of the highest home ownership rates in Europe, of more than 80%. But when the 2008 Global Financial Crisis hit, bursting Spain’s gargantuan housing bubble, over half a million households lost their homes. Many were forced into the rental sector, sparking a surge in demand, particularly in Madrid, Barcelona and other large cities.
Conditions in the market are not exactly consumer-friendly. Many apartments are barely fit for purpose yet somehow command high rents. Fees and commissions are absurdly high. And there is very little social housing.
After the crisis, many social housing projects were sold off to international funds belonging to Wall Street giants like Goldman Sachs and Blackstone. As a result, rented social housing, which normally offers cheaper rents, came to represent just 2% of all residential property in Spain. That compares to 30% in the Netherlands, 24% in Austria, 21% in Denmark and 17% in the UK and France. The Pedro Sánchez government has repeatedly pledged to increase the stock of social housing, to little avail.