Spain Bans Vulture Funds From Buying Cheap Homes

The Spanish government has approved a new housing decree that includes a ban on so-called vulture funds buying residential properties for less than 70% of their market value. The measure is one of several included in the decree, which was announced amid growing public concern over housing affordability in Spain.

Vulture funds are investment funds that typically acquire distressed assets, such as properties or debts, at heavily reduced prices with the aim of reselling them for a profit. Critics argue that this practice contributes to the displacement of residents and drives up prices in affected neighbourhoods, particularly in cities where demand for housing already outstrips supply.

Alongside the restriction on vulture funds, the decree introduces a new index that will determine whether rents can be increased before 2028. This index is designed to establish a maximum allowable rent depending on the location of a property, reflecting the significant differences in housing costs across Spain's regions.

According to the source material, the government has presented the index as a tool that residents can consult to find out the maximum price applicable to their area, although further technical details were not specified in the available summary.

The decree forms part of a broader package of measures aimed at regulating the housing market, though the full list of provisions has not been detailed in the reporting reviewed here. Spanish officials have framed the reforms as necessary steps to curb speculation and protect tenants amid a prolonged housing crisis marked by rapidly rising rents and property prices in major urban centres.

The announcement is likely to generate debate among landlords, investors and housing rights groups, who have historically held opposing views on the effectiveness of price controls and restrictions on institutional buyers. Supporters argue that limiting the activity of vulture funds will help stabilise local housing markets, while opponents warn that such restrictions could deter investment and reduce the overall supply of available housing.