The Official State Gazette (BOE) has today published the agreements between the Ministry of Housing and Urban Agenda and the Official Credit Institute (ICO), which launch a line of loans and guarantees from the ICO for the promotion of social housing for affordable rent. These are the agreements for the implementation of the “Facility for the promotion of social housing” and for the management of guarantees on behalf of the State of said facility.
These support lines mobilize a total of 6,000 million euros through the ICO for the construction of affordable rental housing. The 6,000 million is divided into two lines of investments: 4,000 million in loans for public and private developers, coming from the Recovery, Transformation and Resilience Plan Addendum; and a line of 2,000 million euros that will guarantee up to 50% of these loans, promoted by the Government of Spain and managed through the ICO.
The agreement was signed at the Ministry of Housing and Urban Agenda headquarters on July 31 and was presided over by the President of the Government, Pedro Sánchez. The Minister of Housing and Urban Agenda, Isabel Rodríguez; the Minister of Economy, Trade and Business, Carlos Cuerpo; the State Secretary of Housing and Urban Agenda, David Lucas; and the President of the ICO, José Carlos García de Quevedo, signed the documents that give the final boost to these support lines.
The President of the Government highlighted the importance of the investment figure of 6,000 million euros of these agreements, pointing out the ambition of this initiative. According to Sánchez, the 4,000 million euros linked to the addendum of the Recovery Plan demonstrate the relevance of European funds not only for the construction sector but also for citizens. Sánchez emphasized his Government’s commitment to housing and his willingness to make this legislature the “legislature of housing.”
The 4,000 million euro loan line is aimed at projects that increase the stock of social rental housing or energy-efficient affordable housing, either through new construction or renovation. This agreement includes the financing of operations from January 1, 2022, to June 1, 2026, with loans needing to be formalized before August 31, 2026.
There will be two ways to access financing for these projects, distributed according to demand. Initially, the ICO will mobilize 2,000 million euros and the participating financial entities will mobilize the remaining 2,000 million, although this distribution may vary according to demand. If the ICO grants the loan, only the fulfillment of requirements and the risk of the operation would need to be verified. If the financial entities route is used, they will analyze the risk according to their risk policy and assume the risk of default.
The loan must be requested through a financial institution or directly with the ICO. The projects will be aimed at increasing the stock of social rental housing or the rehabilitation of existing housing, including actions from the Affordable Rental Housing Construction Program of the Recovery Plan.
The houses built with these loans must be destined for social or affordable rent for a minimum of 50 years. The financed projects must meet climatic requirements, where the buildings constructed must reach a consumption of less than 20% of primary energy and the rehabilitated must reduce at least 30% of non-renewable primary energy.
The Council of Ministers approved on December 27, 2023, the creation of a guarantee line to cover 50% of the loan capital, managed by the ICO and automatically granted upon loan approval. This measure has the same term of validity as the repayment period of the loan or, if longer, up to 30 years.
With this important initiative, the government aims to promote the construction of affordable housing, contributing to the social and urban improvement of the country.
via: MiMub in Spanish
