Economy
‘Quite sad’: Renters turn to lottery in Spain’s housing crisis
MADRID
Sergio Encinas (L) and his partner Lorena Pacheco pose in their apartment in Madrid on February 20, 2025.
Lorena Pacheco has hit the jackpot: She won the right in a municipal lottery to rent a two-bedroom apartment and parking spot in one of Madrid’s few social housing estates.
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Like a growing number of Spaniards, the 30-year-old auxiliary nurse and her partner, Sergio Encinas, have found themselves priced out of the real estate market as rents have soared due to insufficient supply.
For the past two years, the couple searched in vain for a place where they could afford to move in together. In the meantime they have been forced to live separately, each in their parents’ homes.
“I felt a great euphoria, followed by a feeling of unreality,” Pacheco said, recalling the moment she saw on social media that she had won an apartment in southern Madrid for 550 euros ($575) a month.
Around 44,000 people took part in the draw, which produced 63 other winners.
“Relying on luck to move out of your parents’ house is a reality in this country,” said Encinas, a 31-year-old salesman who makes about 1,200 euros “in a good month.”
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“It’s quite sad, because you have a job, you work 40 hours a week and you realise that you can’t afford to take care of yourself with your salary.”
Rents in Madrid have risen by 82 percent in the past decade, according to the property listings website Idealista, mirroring increases in other major Spanish cities.
And social housing is very scarce. Madrid, a city of around 3.4 million people, has just 9,200 low-rent social housing units, one of the lowest figures in the European Union.
Madrid’s right-wing city hall has a target of 15,000 social housing units by 2027.
This compares with 260,570 social housing units in Paris, which has a population of 2.1 million, and around 100,000 in Berlin, which has a population of 3.4 million.
Every quarter, Madrid puts 50 to 200 social housing flats up for grabs in a lottery that is open to people who meet income and residency criteria.
More than 80 percent of these flats go to people under 35 and families, Madrid’s housing councillor Alvaro Gonzalez told AFP.
“These new tenants will never have to spend more than 30 percent of their monthly income on housing,” he added.
But this lottery meets just one per cent of demand.
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Only 90,000 new units are built in Spain every year while 120,000 new households are created, according to Idealista figures, leading to a housing shortage that has caused rents to soar.
A boom in holiday lets on platforms such as Airbnb has worsened the housing shortage, sparking large protests across the country and pushing housing to the top of the political agenda.
Socialist Prime Minister Pedro Sanchez has unveiled several measures to try to ease the housing crisis, including higher taxes on holiday lets and the acceleration of social housing construction.
But Idealista spokesman Francisco Inareta warned that some of the government’s “coercive measures” had driven landlords out of the long-term rental market, hurting “the young and disadvantaged.”
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“Landlords are not the problem, they are part of the solution. It is therefore crucial to approach the market pragmatically,” he said.
STOCKHOLM
Sweden’s government said it will hold talks with food producers and distributers as a consumer movement over soaring costs in the Nordic country gains traction.
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Annual food price inflation in Sweden hit its highest rate in two years in February at 3.9 percent.
Meanwhile, the independent watchdog site Matpriskollen (The Food Price Checker) found in January that prices in Swedish grocery stores had risen by 19.1 percent over two years.
“In view of the rapid price developments in the first months of the year and the rising prices in recent years, the Minister of Finance and Rural Affairs Minister will invite selected actors from the food supply chain for talks,” the government said in a statement.
The aim of the talks is to “listen to the industry’s assessment of the situation and work together to lower prices for customers,” it added.
The move comes as a viral online campaign calling for a boycott of major grocery stores next week has picked up speed.
One of the campaigners, Annika Morina, told newspaper Aftonbladet that she reached her breaking point buying tomato puree on Valentine’s Day.
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“It had gone up 50 percent. I’ve seen these kinds of boycotts in countries in the Balkans and felt: ‘Why don’t things like that happen in Sweden?’,” she said.
She posted a video to TikTok calling for the boycott which has received tens of thousands of views and according to Aftonbladet thousands are expected to join the boycott.
Consumers in Croatia frustrated by soaring prices massively joined two boycott calls in January, sending daily sales down by over 40 percent.
LONDON
Britain’s Chancellor of the Exchequer Rachel Reeves (C) meets with defence suppliers at RAF Northolt on March 6, 2025 in Ruislip, west of London. Reeves met with UK defence suppliers to Ukraine.
The British government said on March 14 that it would increase its export credit facilities for weapons manufacturers by two billion pounds ($2.6 billion) to boost overseas sales.
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The new funds “will see billions of pounds unlocked for U.K. defence companies that export overseas, driving economic growth and creating jobs across the U.K.,” it said in a statement.
Already the U.K. Export Finance agency has a lending capacity of eight billion pounds specifically for government clients of defence contractors, bringing the new total to 10 billion pounds.
Like other countries across Europe, Britain is racing to beef up its military production capabilities in the face of an expansionist Russia, pressure on European members of NATO to spend more on defence, and questions over President Donald Trump’s commitment to U.S. protection of Europe.
British Prime Minister Keir Starmer pledged ahead of a White House visit in February to boost defence spending to 2.5 percent of the economy by 2027, with the aim of hiking it to 3.0 percent in the next parliament.
“The world is changing, and we must bring about a new era of security and renewal that protects working people and keeps our country safe,” Chancellor of the Exchequer Rachel Reeves said in the statement.
ANKARA
The services production index increased by 6 percent on an annual basis in January, gathering pace from the previous month’s 2.6 percent rise, data from the Turkish Statistical Institute (TÜİK) showed on March 14.
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The monthly increase in the index also quickened from 1.3 percent in December to 2.5 percent in January.
The index for transportation and storage services increased by 3.2 percent year-on-year but declined by 0.5 percent month-on-month.
Accommodation and food services rose 9.6 percent from a year ago and 0.5 percent compared to the previous month, the statistics authority said.
The annual and monthly increases in the index for information and communication services were 9.9 percent and 6.4 percent, respectively.
Real estate services rose 8.9 percent year-on-year, according to TÜİK data.
The prevalent price-setting behavior in the services sector leads to significant inertia and causes the impact of shocks on inflation to extend over a long time period, the Central Bank said in the summary of the March 6 Monetary Policy Committee meeting released on March 13.
Services inflation remains higher than goods inflation, it said, adding that having slowed down in the final quarter of 2024, services inflation increased in January due to the effects of items with time-dependent pricing.
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