THE EFFICACY OF ACT 4/2013, REFORMING THE LAW OF URBAN LEASES, TO INCREASE TENANCY-OCCUPIED DWELLINGS IN A EUROPEAN CONTEXT

Abstract

Renting a home is currently not a real alternative to home-ownership in many countries, while a low percentage of rental housing pre-vents proper functioning of the market. The reasons for the low rate of rental housing may be different in nature, but many of them are rooted in the legal framework of urban leases. A lease legally designed as not flexible nor stable nor affordable for tenants has little chance of succeeding. If legal uncertainties and poor yields, few guarantees and inefficient eviction process are added to the formula, this type of tenure will neither be attractive to landlords. This article analyzes the key elements that determine the rate of rental housing in the three countries with highest rental housing rates in Europe and in the five southern European countries with low lease rates, including Spain which has the lowest, to find common elements that encourage or discourage citizens when opting for renting their home instead of buying it. This work also analyzes whether the trend started in Spain by Law 4/2013 is the right one to increase rental housing.