Madrid raises subsidised housing prices by 56%

Madrid raises subsidised housing prices by 56%

Isabel Díaz Ayuso, president of the Community of Madrid, has fulfilled her commitment to update the prices of subsidised housing (VPO) modules, which had not been modified since 2008. This measure unblocks the construction of thousands of affordable housing units, in response to the demands of the sector, which pointed out the lack of profitability in the production of this type of property. The update comes at a crucial time, as approximately 70,000 homes are expected to be developed over the next four years, of which 35,000 will be VPOs.

The new order has approved increases of up to 56% in the modules, derived from the elimination of one of the groups of municipalities, which resulted in a higher increase for those previously classified in group D, which have now been integrated into group C. The zoning of municipalities such as Boadilla del Monte and Tres Cantos, which have been moved to zone A, and San Agustín de Guadalix, which has changed to zone B, has also been readjusted, depending on the sale price of free housing and the average income level per household.

Price changes by zone

With regard to prices, maximum sales prices per square metre of usable area have been set for subsidised housing, applicable to both sale and rental. For the basic price category, the values are 2,450 euros in Zone A, 2,110 euros in Zone B and 1,900 euros in Zone C. For the limited price category, the costs amount to 2,820 euros in Zone A, 2,430 euros in Zone B and 2,180 euros in Zone C.

The increases vary according to the zone: in group A municipalities, the increase has been 26.25%; in group B, 33%; and in group C, 36%. These increases respond to the need to update maximum sales prices after more than fifteen years, taking into account cost inflation due to factors such as the COVID-19 pandemic, the increase in oil and gas prices, and new regulatory requirements related to energy efficiency.

In addition, it is established that the maximum prices will be automatically updated every 1 January from 2025 onwards, according to the Consumer Price Index. For dwellings intended for rental under Royal Decree 801/2005, the maximum price per square metre will be set at 1.5 times the maximum legal price, updated in accordance with the variation in the CPI since the date of provisional qualification.

This update is part of a shock plan announced by Ayuso to stimulate the real estate market with tax reductions and aid for the under 40s, together with the relaxation of urban planning regulations to convert office buildings into housing

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