It is harder than ever to obtain the building licence in Valencia. But, looking on the bright side, Spaniards have one of the world’s highest life expectancy rates, so it all balances out in the end…
One of the most difficult challenges during the first Estado de Alarma, and in fact throughout the entire year of 2020, was maintaining economic activity at previous levels. While most industries were able to maintain or only slightly reduce output, it was known that two sectors would be unable to keep up – tourism and the construction industry.
Valencia saw few tourists arriving last year as a result of the pandemic and the attendant restrictions on movement. There haven’t been many new construction projects, either. Nobody was overly optimistic at the time, so building licence applications fell by half from the previous year’s level, as expected. While there were 3,223 applications in 2019, there were only 1,692 in Valencia in 2020. That low a number was last seen in 2016, the first year after the big property crisis was officially over for the building industry.
The logical conclusion would be that there is a silver lining to this story: with fewer applications, surely the city administration would be able to grant existing licences quicker, reducing the bottleneck that dates back to the days when the Partido Popular ruled the Province. But, there is no silver lining here. According to Las Provincias, the bottleneck in granting building licence in Valencia today is worse than ever. At the moment, the City Council has 4,000 pending licences, some of which date back to 2015, and it doesn’t look likely that anything will change any time soon.
The average wait time for a technician to be assigned to an application for the rehabilitation of an unprotected building is nine months, according to a Department of Urban Development statement given to the press. If the building is part of a protected area, the wait is eight months, and in the case of completely new builds, it is approximately five months.
However, this is not the entire time required for the licence to be granted. If there are any objections, the waiting time will be far longer.
A story about the investors of a brand new hotel on Calle Blanquerias is going around the city as a joke, but it isn’t. In 2017, they applied for a permit to begin renovation works on a building that housed the Partit Socialista del País Valencià (PSPV, or Socialist Party) headquarters. And they still don’t have a date. There appears to be another building on Calle Eixarchs, whose investors started the wearying process of obtaining the licence in 2015.
The City Council has demonstrated strong resolve to address many problems left by the previous administration, and has bravely taken on projects that had been neglected for a long time – reconstructions across the city, finalising plans for Cabanyal and Natzaret and completing the Metro. Those are all large projects that required a significant amount of investment, time and planning. However, something as simple as granting building permits should be far more achievable, and sadly, the situation today is worse than ever.
“Today, it takes longer to obtain administrative procedures than to do the work,” says Antonio Olmedo, president of the Valencia Association of Real Estate Developers and Urban Development Agents. Considering that doing the actual work in Valencia can be excruciatingly slow compared to other European cities, that is damning.
This issue is beginning to have an increasing impact on the real estate market. Businesses cannot commit capital for such a long period of time, whether they are building or simply renovating, and must divert their investments elsewhere. Local communities cannot easily renovate their buildings if the work is complex and needs a building permit. People who want to sell their current home and buy something they can renovate, or simply build a new house, are forced to sell their current home and rent an intermediate one for a long time before they can even move to their new property.
This way, the properties that need the most help, the ones that require complete renovation, are becoming unattractive and poised to stay on the market much longer and to decay even further.
In the Recovery and Resilience Plan, recently announced by President Sanchez, Spain intends to renovate half a million houses to improve energy efficiency, with the state paying in some cases 100 percent of the costs in a €6.8bn plan. No one can be how much of that money will end up in Valencia, but it seems safe to say that, when it does, it won’t be spent for some considerable time.