The Evolution of Housing in Spain: A Shift from Commercial Spaces to Residences
If someone had proposed ten years ago that prices for houses would skyrocket to the extent that even tourists would retreat from their luxurious havens in the Balearic Islands and Canary Islands , many would have considered that notion far-fetched. Yet, this scenario has unfolded in reality. By 2019, experts noted that a simple calculation—comparing the number of empty stores and the rising costs of apartments—yielded alarming results. What began as an innovative experiment with making commercial properties functional living spaces is rapidly transitioning into a standard approach for several town councils in Spain.
A New Housing Policy in Móstoles
In a groundbreaking move, Móstoles , located in the Community of Madrid, has decided to utilize its closed commercial spaces as urban housing reserves. This initiative is grounded in a Special Plan that aims to make the conversion of empty commercial properties into residential units more efficient. Key features of this plan include shorter licensing times, reduced costs associated with the Construction Tax on New Buildings (ICIO) , and limiting prohibitions to essential commercial areas. The dual objectives are clear: to generate more affordable housing and to prevent the visual and functional decline of areas that have seen a downturn in commerce.
This initiative is part of a broader strategy that is projected to add thousands of units through urban developments in Móstoles. Significantly, the city acknowledges the legitimacy and necessity of converting unsuccessful retail spaces into livable homes—an approach that had been previously dismissed by many municipal authorities due to regulatory, reputational, or political concerns .
Living in Converted Spaces
The underlying logic of Móstoles’ approach is reflected in similar actions taken by other municipalities facing pressing housing conditions. For instance, Petrer , a town in Alicante, recently revised its urban plan to permit the conversion of commercial spaces in areas where businesses have ceased to operate. Already, 42 properties have been transformed into residential units while ensuring strict standards to avoid subpar housing conditions.
In these high-pressure environments, the focus has shifted from the question of “if” such conversions should occur to “how” they can proceed without encountering problems. The city has chosen to act in the only domain within its control: urban planning .
Further Developments in the Canary Islands
The Canary Islands have also embraced this trend. In Arrecife , 39 commercial properties have been authorized for conversion into residences under a streamlined decree that emphasizes habitability and ventilation requirements. The rationale is similar: to draw residential supply from defunct retail spaces, alleviate rental pressures, and revitalize struggling urban communities.
Zaragoza Joins the Movement
The trend is not limited to Móstoles and Arrecife; Zaragoza , the capital of Aragon, is another significant player in this housing transformation. Since 2021, the city has authorized 177 conversions, with 36 licenses issued in 2025 alone. This shift occurred after Zaragoza adjusted its urban planning regulations to make the conversion process more accessible while considering vital factors like sound levels, space, and ventilation.
Notably, the recognition of the conversion of commercial spaces into residences as a stable residential policy indicates a conceptual overhaul. Instead of being viewed as an exception, this strategy is becoming a standard method for managing vacant properties in urban areas.
Regulatory Framework and Conclusion
Ultimately, the success of these conversions relies not solely on political declarations but on establishing clear regulations : the urban plan must permit conversions, the properties must meet size and height standards, and necessary permits for construction and occupancy must be secured. Streamlining and standardizing these processes will ensure that what was once seen as a rare strategy becomes a routine procedure across various municipalities.
The decision by larger metropolitan areas, such as Móstoles, to adopt this approach highlights a significant shift in urban housing policy. It signals that reconversion of commercial spaces into residences is no longer a peripheral solution but rather a central strategy in addressing housing shortages effectively. By reopening discussions on the fate of dormant commercial properties, Móstoles encourages others to act, sparking a broader movement across Spain to address the pressing housing crisis.