Rent controls in Barcelona have dramatically worsened the city’s housing shortage, causing a sharp contraction in available rental stock rather than improving affordability, according to Cristina Garcia-Pery, senior partner at Azora Group.
Speaking at the IPE Real Estate Global Conference & Awards 2026 in Rome, Garcia-Pery said government intervention in the rental market has had unintended consequences.
“The amount of stock being offered for rent has gone down by almost 80%,” Garcia-Pery said, referring to Barcelona’s regulated rental market. “The impact has been completely the opposite of what was intended.”
Catalonia introduced rent controls around five years ago in so-called “tensioned areas” such as Barcelona, limiting landlords’ ability to raise rents. According to Garcia-Pery, the policy has backfired, discouraging both institutional and private landlords from keeping apartments on the rental market.
Many owners are now selling units individually when tenants leave, including investors such as Azora, which has been buying rental portfolios and selling flats one by one as they become vacant.
“It breaks my heart but everyone is just selling because they are sitting in a market that is growing very healthily and yet they are not able to capture that growth,” she said, adding that institutional ownership of rental housing in Spain remains below 5%.
Garcia-Pery said rent caps discourage investment without addressing the core issue of undersupply. “Rent caps haven’t worked at all and yet there are other regions in Spain that are considering introducing them,” she said. “The only way to solve the problem is by building more houses and building more affordable houses.”
Azora, which manages around €15bn in assets across Europe and the US, was founded more than two decades ago through investments in affordable rental housing. Today, around 40-45% of its assets are concentrated in “living” sectors including residential, student housing and senior living.
Garcia-Pery argued that Europe’s structural housing shortage continues to make residential property one of the region’s safest long-term investment themes. In Spain, however, lengthy planning timelines and regulatory intervention are limiting supply further. She noted that converting rural land into developable land can take as long as 15 to 20 years.
Against that backdrop, Azora is adapting its strategy by targeting late-stage land opportunities, residential conversions and selective built-to-rent investments, often aiming for returns above 20%.
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