Alert. An email from Idealista reaches the email of Laura Martín, 31, from Huelva. 920 euros for a 70 square meter apartment in Lavapiés. Look at the photos. No doubt. Immediately, call the landline of the Madrid real estate agency that appears in the ad:
– Hello good day. I would like to visit the flat.
– No problem. The only thing is that, in addition to the month of rent, we ask for three months of deposit, one month of agency plus VAT and the last three payrolls.
Martin hangs up. He didn’t even want to answer. “For what? This happens to me every two by three with the ads, ”he says by phone. “They are shameful clauses. I can’t drop 5,000 euros all at once ”. Looking for a flat in Madrid is a bureaucratic adventure with great obstacles. Tenants, most of them young, are increasingly faced with new rental clauses in their contracts: more than three months of deposit, month of agency, non-payment insurance, bank guarantees, income statements, payroll with a minimum of 1,300 euros, bank movements in your accounts …
In Idealista, for example, many cases are found with a quick search. The Grupo Inmobiliario Alquila has 76 advertisements on the portal. All floors include this paragraph: “Our conditions are: one month of deposit, one month of guarantee deposit, one month of fees and the current month. Both the deposit and the guarantees are returned at the end of the contract. We ask for a work contract and payroll ”. An example. For a 58 square meter one-room apartment in Puente de Vallecas, seven metro stops from Puerta del Sol, 750 euros are requested. The tenant will have to drop 3,000 euros at once if he wants the property.
“We have noticed that the real estate companies in Madrid are increasing these excessive clauses, above all they require guarantees to be able to rent”, underlines María Matos, spokesperson for the Fotocasa portal. “These conditions have multiplied a lot due to the fear of non-payment,” explains a worker from the Entre Fincas de Vallecas agency. “Almost all owners already ask for two months of deposit, the current month, the month of agency and a non-payment insurance, which is around 250 euros a year. A mileurista can no longer pay a rent of 800 euros ”.
Miguel Ángel Gómez is the president of the Madrid Association of Real Estate Companies. He believes that these additional conditions have not changed much in recent times. “What you do is check the viability of the tenant. The problem in Spain is that there is no common criterion regarding the conditions and this is what should change. For example, in some communities the month of agency is paid by the landlord and in others by the tenant ”. Why does this happen?
An article in EL PAÍS from 2016 recalls that in Madrid and Barcelona it is the tenant who pays the agency fees, when in reality the client is the owner of the property. On the other hand, in La Rioja or in Vigo the landlord takes over. “In terms of fees, the free market governs and each agent follows a collection system based on the uses and customs of each place,” explained the then president of the General Council of Associations of Real Estate Property Agents of Spain, Diego Galiano. In Madrid, the tenant pays by tradition, simply.
More than a dozen real estate agencies consulted in Madrid say that these new additional clauses are increased if, above all, the tenants are students. “The issue of occupation”, observes a spokesperson for the Duomo de Lavapiés agency, “has made the owners much more alert. There is too much publicity regarding non-payment. These clauses are imposed mainly in the most humble areas of the city ”.
More cases. The real estate agency Red Piso, with more than 3,000 advertisements on Idealista, states in some of its advertisements: “The requirements are the employment contract, the last three payrolls, the current month, the deposit month, the deposit month and the agency month.” Thus, dozens and dozens of floors of more real estate. “I recommend that homeowners pay for insurance and require fewer months of deposit. Thus, it is more covered than if they ask for 5,000 euros at once ”, explains a worker from Red Piso in Puerta del Sol.“ There is a lot of fear of non-payment. A bad tenant can ruin your life. ” The delinquency rate for rent increased 70% due to the pandemic, according to the latest study of the File of Delinquent Tenants of 2020.
There are four compelling data that explain the situation of the rental market in Madrid. One. Renting a home in Madrid is 82% more expensive than the average in other cities in the country, according to a report published on August 2 by the Bank of Spain. Two. According to an analysis prepared by EL PAÍS in 2020, a couple under 35 years of age and with an average income can only find affordable rent in the open market in 13 of the 128 neighborhoods of Madrid. Three. The latest 2019 Youth Emancipation Observatory report describes: “The continued increase in the prices of the real estate market, both for sale and for rent, make housing an economically unattainable asset for the population between 16 and 29 years of the Community of Madrid ”. And four. The average rent in the capital is 780 euros, the highest in Spain, according to the Home Rental Index prepared by the Ministry of Transport last April.
Uruguayan Natalia Hernandez, 27, has just arrived in Madrid for work. He works as a manager of a call center. He has been looking for a flat for two months. “I have never seen anything like it. Here the rents are extremely expensive. For a rent of 1,000 euros they ask me for two months of deposit, two of deposit and even a solvency study. I want to rent an apartment, I am not here to ask for a loan ”. Another case. Sandra M., 48, lives for rent in Leganés with her husband and two children. They want to change house. Her husband works temporarily as a security guard. She only charges an aid of 440 euros. “This depends on who you contact. If I speak with the Insurance Rental, they demand two payrolls of 1,300 euros, a four-month deposit that will be returned to you when you enter and an annual insurance for the apartment of 150 euros. It is impossible”.
On the phone of the tenant union for rent this is the bread and butter. “You cannot ask for more than two months of bail,” explains Fernando Bardera, a spokesman for the union. “These abusive clauses are protected by general ignorance. If they ask for four months, they are actually keeping it. The same happens with those real estate companies that require, in addition to several months of deposit, the month plus VAT ”. Article 20 of the Urban Leasing Law It says that these fees will always be paid by the landlord, but in many advertisements and contracts they are paid by the tenant. “When this is requested from the tenant, we always recommend demanding a complaint form and taking it to the Consumer Institute,” says Bardera. “This is as if they ask you for the brick tax, which does not exist. They take advantage of the tenant’s ignorance and if he sneaks, sneaks ”.
The 27-year-old Gabriel Leire from Galicia was succeeded last year. He paid 1,400 euros of deposit plus VAT. “I did not understand that, but we released the money for fear of running out of the apartment.” Now it has become independent. His landlord has demanded that he join the Rent Plan of the Community of Madrid, a public service that processes 4,000 contracts a year, where half are tenants under 35 years of age, according to data from the Housing Department. In this plan, the owner puts the price of the house a little below the market price on the condition that insurance is guaranteed against a possible default.
Leire charges € 30,000 gross per year and has a permanent contract. “They have asked me for my income statement, the last three payrolls, my entire working life and my contract, which I think is not bad.” The Rent Plan of the region has also demanded a guarantee of 30,000 euros that his father has to put up. The apartment you intend to move to is in Ensanche de Vallecas. You will pay, if you finally meet this requirement, 800 euros per month. “The problem is that there is a lot of competition when the apartment is affordable and, if you don’t accept these conditions, someone else takes it.” This Wednesday there were 20,070 rental flats in Idealista in Madrid. Only 282 flats cost 600 euros. Most measure 25 meters.
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Eddie is an Australian news reporter with over 9 years in the industry and has published on Forbes and tech crunch.