New rent seeking strategies in housing in Spain after the bubble burst

ABSTRACT

This paper analyses the new rent seeking strategies in housing implemented during Spain’s financial crisis. The Spanish Model presents a paradigmatic case of the need for capital to reinvent itself through the articulation of new mechanisms for the production and appropriation of urban rent, as the crisis revealed the limits of strategies that were implemented during the bubble period. Amongst these new strategies, the paper analyses the rescue of financial entities, the creation of a ‘bad bank’ and the establishment of Spanish REITs. These mechanisms are leading to financialisation of rental housing and the emergence of vulture funds as new transnational owners of housing.

KEYWORDS:

• Rent seeking
• housing
• financialization
• crisis
• transnational homeowners
• Spain

Acknowledgements

The current work has been financed by the research projects ‘Crisis and vulnerability in Spain’s island cities: transformations of spaces of social reproduction (CSO2015-68738-P)’ and ‘New Models of Urban Governance in the post crisis period’ (CSO 2016-75236-c2-1-r)’ within the National Plan for R&D of the Ministry of Economy and Competitiveness of the Spanish Government. It has also been possible thanks to the funding of the Vicepresidencia i Conselleria d’Innovació, Recerca i Turisme of the Balearic Islands Government.

Disclosure statement

No potential conflict of interest was reported by the author.

Notes

1 The FROB was created with the objective of promoting the restructuring of entities and voluntary mergers and the banking of saving banks. It is the instrument that conveys the injection of public capital.

2 It is the process of grouping several credit entities in Spain, conceived as a mechanism for consolidating entities for mutual self-protection.

3 The Asset Management Company from Banking Restructuring is popularly known as ‘bad bank’. Despite not being a financial entity, entities rescued with public money have transferred their toxic assets from the real estate sector through public aid from the European rescue to Spanish banks.

Additional information

Funding

The current work has been financed by the research projects ‘Crisis and vulnerability in Spain’s island cities: transformations of spaces of social reproduction (CSO2015-68738-P)’ and ‘New Models of Urban Governance in the post crisis period’ (CSO 2016-75236-c2-1-r)’ within the National Plan for R&D of the Ministry of Economy and Competitiveness of the Spanish Government.