The Government subsidizes 29 affordable rental developments with 201.7 million

The Council of Ministers approved on October 27 Royal Decree 928/2026, of October 28, which regulates the direct granting of subsidies to finance the works concession contracts for affordable rental housing to be tendered by CASA 47 Public Business Entity. The regulation is published in the Official State Gazette (Boletín Oficial del Estado) no. 269, of October 29, 2026 (Sec. I, page 144583; reference BOE-A-2026-22617) and enters into force on October 30, the day following its publication.

The text, promoted by the Ministry of Housing and Urban Agenda led by Isabel Rodríguez García, authorizes a maximum global amount of 201,700,000 euros, fully transferred by the department to CASA 47 charged to two budget items between the 2021 and 2026 fiscal years and assigned to these actions by agreement of the Monitoring Committee of the agreement of July 15, 2026.

201.7 million for 29 actions and approximately 2,425 homes

Previous feasibility studies estimate the scope of the program at 29 actions attached to the Affordable Rental Housing Plan, with the capacity to house around 2,425 homes. The developments will be executed mostly on land owned by CASA 47, although also on land made available by other public administrations.

The royal decree is based on the agreement signed on November 10, 2022, between the then Ministry of Transport, Mobility and Urban Agenda and SEPES Public Land Business Entity, now CASA 47, and on the reform of Law 9/2017, of November 8, on Public Sector Contracts introduced by Royal Decree-Law 7/2026, of March 20. That modification added a fifty-seventh additional provision with a specific regime for works concession contracts for affordable housing on public land, with a maximum term of up to 80 years.

The preamble justifies the urgency based on the structural housing deficit, which the Bank of Spain estimates at more than 400,000 units, and a national average price of 2,230.0 euros per square meter at the close of 2025, the highest nominal value in the series since 1995.

Limited rents, 60 years and prohibition of overcompensation

The beneficiaries will be the natural or legal persons awarded the works concession contracts, who will assume the construction, conservation, and operation for affordable leasing. Their main obligations are:

• Allocate all housing to affordable rental, without change of use or separate alienation.
• Set monthly rents lower than market rates, such that the rent, including the estimate for utilities, does not exceed 30% of the estimated disposable income of the median typical cohabitation unit.
• Assume the operational risk and the demand risk.
• Revert the works to CASA 47 at the end of the concession.

The term of the public service obligations extends until the end of the contract, with a maximum duration of 60 years. The subsidy for each contract will be calculated as the amount that brings the net present value of the cash flows to zero at the end of the concession period and may not exceed 60% of the eligible cost nor the amount necessary to compensate for the financing deficit. Bidders may offer a lower subsidy, a criterion that will be evaluated during the award process.

The regulation recognizes the actions as a Service of General Economic Interest (SGEI) for affordable housing, in accordance with Commission Decision (EU) 2025/2630 of December 16, 2025, which exempts the aid from the obligation of prior notification to Brussels and requires separate accounting and submission to overcompensation controls.

The tender replaces the public call

The concession procedure is structured within the tender for the works concession contract itself, such that the award resolution from the contracting body of CASA 47 will have the effects of a resolution granting the subsidy and the formal mandate for the management of the SGEI. The competent body to agree upon each concession is the entity’s Governing Council.

Among the award criteria quantifiable by formulas are the reduction of the subsidy amount, the reduction of the concession term, the reduction of non-renewable primary energy consumption, the industrialization of construction, and the reduction of the works execution period. The resolution will be published in the National Subsidy Database (BDNS), which will replace the individual publication in the BOE.

Payment will generally be made upon justification, although the specifications may provide for an advance payment of the total subsidy if the contract guarantees cover the return of the advance. The justification account must be submitted within a maximum period of three months from the completion of construction.

Urgent processing was agreed upon by the Council of Ministers on July 28, 2026, so as not to compromise the tender schedule and the market launch of the housing.

Impact for developers and applicants

The regulation establishes the concession model as the operational pathway for incorporating private capital into the promotion of affordable rentals on public land: interested developers compete for contracts of up to six decades with a maximum subsidy of 60% of the construction cost and capped rents. For the applicants, the text safeguards the social purpose of the 2,425 planned dwellings and limits their rent to 30% of the disposable income of the median household, although the effective rollout will depend on the tendering of the 29 contracts and the execution of the works.

Source: Official State Gazette, no. 269, October 29, 2026, Sec. I, p. 144583 (official reference: BOE-A-2026-22617).