Spain to pass host of rent-lowering measures

People walk past an apartment complex that advertises "Properties and parking available" in Madrid, Spain, June 19, 2019. REUTERS/Susana Vera

MADRID, Oct 5 (Reuters) - Spain's coalition government agreed on Tuesday on a draft law to control rents through a mix of coercive measures and tax incentives.

"The new bill seeks to contain the price of rents and reduce it," recently-appointed presidency minister Felix Bolanos told a news conference on Tuesday. Part of Bolanos's job is handling the relationship with parliament, which will have to ratify the bill.

The new bill would include tax incentives for small landlords who cut the rents they charge and would boost property taxes on houses left empty by their landlords, the minister told reporters after the weekly cabinet meeting.

The draft law will require 30% of new-build housing projects to be set aside for social housing, he said.

The bill on housing is part of a wider agreement between the Socialist Party and the far left Unidas Podemos, the ruling coalition partners, who had been bickering for weeks over next year's budget bill.

The 2.25 billion euro ($2.61 billion) housing budget announced by prime minister Pedro Sanchez on Tuesday includes 1 billion euros to expand Spain's social housing stock which, at around 2% of national stock, is much lower than in other European countries.

The housing legislation would also allow regions to order landlords with more than 10 properties to lower rents in areas with high demand, a source at Unidas Podemos said on Tuesday.

The government also plans to grant a 250-euro monthly bonus for low-income people age 18 to 35 to help them pay their rents and leave their parents' home, a critical issue in Spain.

The government said it would disclose more details on the bill in coming days.

($1 = 0.8621 euros)

Reporting by Belen Carreno, Inti Landauro, Clara-Laeila Laudette and Emma Pinedo; Editing by Nathan Allen and Ed Osmond

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