The draft housing decree reintroduces a state deduction of 10% for young tenants, with a maximum saving of 904 euros. It also introduces bonuses of up to 100% on income tax for landlords who reduce rent.
The new housing decree being negotiated by the Government includes a state deduction of 10% on rental amounts paid for young people aged between 18 and 35, with a limit of 904 euros in actual tax savings. The measure, still in draft form, would benefit those with incomes below 24,107.20 euros (double the IPREM).
The deduction would apply to a maximum of 9,040 euros of annual rent, translating to savings of up to 904 euros on the tax return. It does not depend on the autonomous community, as it is state-wide, but its final approval is subject to parliamentary negotiation.
If the decree goes ahead, young people could recover up to 904 euros a year. A figure that does not solve the price increase but alleviates the blow of the monthly bill.
For property owners, the draft also introduces significant changes. If they lower the rent by at least 5% when renewing a contract, the reduction in income tax for rental income reaches 100%, meaning that income is not taxed at all.
If there is no decrease but the price remains the same, the bonus is 70% in two cases: when the tenant is between 18 and 35 years old or when the property is in a stressed area declared by the administration. Conversely, if the landlord raises the rent, the general deduction of 50% is progressively reduced: with an increase of up to 10%, it drops to 40%; between 10% and 20%, to 30%; and if it exceeds 20%, it remains at 15%.
The text also includes an extraordinary extension of leases expiring before June 30, 2028. If approved, tenants will be able to request the extension of the contract, and the landlord will not be able to refuse.
Additionally, the decree includes a tax penalty for Socimis (listed real estate investment companies) that hold residential properties, a measure that would affect large landlords.
The deduction for young tenants is not new: it existed between 2008 and 2014 and was eliminated by the government of Mariano Rajoy. Its recovery now clashes with parliamentary negotiations. Junts and the PNV, essential for approving the decree, have yet to give their approval. Podemos is calling for support from the PP if the reform of the Land Law is included, while Junts rejects 'omnibus' decrees.
Minister Ernest Urtasun (Sumar) sees "space" for agreement, but the date for the Council of Ministers remains unconfirmed. If the text fails, all these bonuses will go back in the drawer.
Meanwhile, rental prices continue to rise, and the effort rate for young people exceeds 40% in many capitals. The proposal may provide relief, but it does not solve the underlying problem: the shortage of affordable housing.
If the decree is approved, young tenants will need to include the deduction in their 2027 tax return. Property owners, for their part, will have to adjust their contracts to benefit from the bonuses.
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