Housing allowance for 22- to 30-year-olds to be scrapped and replaced with new system

SPAIN'S government intends to eradicate young persons' housing benefit for those who rent properties – even for tenants who are already in receipt of this allowance.

Already in 2011, new applications for rental benefit were no longer being accepted and by July last year, this had fallen by 30 per cent to just 147 euros a month.

The Renta Básica de Emancipación ('basic emancipation income') payable to the under-31s to allow them to afford to live in a let property is currently being paid to 59,643 tenants – less than half the 119,000 the government had predicted for this year when setting aside a budget of 210 million euros for the purpose.

It means that numerous 20-somethings could be forced to move back in with their parents after having finally been able to enjoy adult independence and their own space.

The benefit was launched in 2008 in response to inflated house prices and consequent high monthly rent which meant young people were being forced to continue living with their parents until their late 30s as they could not afford to leave.

It was available to all those aged between 22 and 30 inclusive who had a gross annual income of less than 22,000 euros, and paid them 210 euros a month.

Now that house prices and rental costs have plummeted, it is the lack of jobs available that means those in their 20s and 30s are still unable to leave home as they cannot afford even the cheapest housing costs.

But the PP government says housing benefit is creating a drain on regional resources and will potentially leave them with costs of around five billion euros between now and 2018.

Housing benefit as it stands will continue to be payable until a newly-developed allowance scheme is in place.

This will remove the upper age limit and give priority to families and individuals whose homes have been repossessed, and will take into account the full income of the entire household unit.

The maximum income allowable will be 20,000 euros a year.

Per person, income must not exceed 19,200 euros a year and rent payments should be under 600 euros a month.

They will be paid a maximum of 2,400 euros a year, or 200 euros a month.

Council housing will be rented 'in rotation' to people earning up to or less than the minimum wage of 640 euros a month, and monthly rent will not exceed 4.70 euros per square metre of living area – meaning the garden, patio or balcony will not count.

Longer-term council house rent for families with an income of less than 1,600 euros a month will have a maximum monthly rental cost of six euros per square metre of living area.