Spain's Government has revived its housing package just days after Congress rejected its previous measures, approving new versions of two royal decree-laws and announcing a €10 billion financing programme for people buying their first home.

The new measures were approved by the Council of Ministers on Tuesday, October 6, following the rejection of the previous housing decrees by Congress on October 2.

The Government says the new texts maintain the main substance of the measures previously proposed while incorporating some modifications and additional funding.

€10 Billion for First-Home Loans

The most prominent announcement is the expansion of the TU CASA financing mechanism.

The programme will have a €10 billion funding allocation and will provide loans of up to €50,000 to people purchasing their first habitual residence.

The loans are designed to complement private mortgage financing rather than replace it.

The mechanism is intended to help buyers who can afford a mortgage but do not have sufficient savings to cover the initial contribution required to purchase a property.

Under the earlier legal framework for TU CASA, the loan could cover the lower amount of 20% of the value of the home or €50,000. It was designed with a 0% interest rate and no commissions, with repayment over a maximum of 10 years. The Government's previous text also established that the mechanism would be managed by the Instituto de Crédito Oficial (ICO).

The Government has now announced the €10 billion allocation for the programme.

It Is a Loan, Not a €10 Billion Housing Grant

The distinction is important.

The €10 billion refers to the financial capacity allocated to the loan mechanism. It is not a €10 billion fund of direct grants for homebuyers.

Individual buyers would receive financing subject to the conditions established for the programme.

Homes purchased using the mechanism would also be subject to a permanent maximum resale price under the rules contained in the earlier text.

Further details on eligibility, limits and the practical application procedure are to be developed through the corresponding Government decisions and instruments.

The Government Revives the Anti-Eviction Measures

The wider housing package also seeks to restore protections for vulnerable households facing eviction when they do not have alternative accommodation.

This is particularly significant because the previous decree containing the protection was extremely short-lived.

Real Decreto-ley 26/2026 entered into force on October 1 after being published in the BOE on September 30. Congress rejected it the following day, and the derogation was formally published on October 2.

The new Government proposal seeks to restore the main housing protections through the new decree.

The measure is part of a broader package that Sánchez said contains 21 measures covering access to affordable housing, increasing supply, stability for tenants and landlords and measures against speculation.

Rental Contract Extensions

The second decree focuses on the rental market.

It includes a mechanism for the automatic extension of certain residential rental contracts, intended to provide greater stability for tenants whose contracts are approaching expiry.

However, this measure has a particularly important procedural condition.

Sánchez has said that this second decree will not enter into force unless it is validated by the Diputación Permanente of Congress.

That means it would be inaccurate to tell tenants that the new automatic extension is already legally applicable simply because the Council of Ministers has approved the text.

Why the Measures Are Returning So Quickly

The Government's decision comes only four days after the previous decrees were rejected.

Congress voted against the first housing decree on October 2 by 178 votes to 172, meaning the legislation ceased to have effect.

The situation then changed further because the Government has called an early general election for November 29.

With the Cortes dissolved, the new decrees will be considered by the Diputación Permanente rather than going through the normal full parliamentary process. The composition of that body is therefore particularly important to the Government's attempt to secure validation.

What This Means for First-Time Buyers

For prospective first-time buyers, the proposed TU CASA mechanism could be significant because the initial contribution is one of the major barriers to accessing a mortgage.

A maximum loan of €50,000 could potentially cover part of the purchase contribution for an eligible buyer, subject to the final rules and the value of the property.

It is not, however, a €50,000 grant. The money would have to be repaid under the conditions established for the programme.

The permanent resale-price restriction attached to homes acquired through the mechanism is another important consideration for future buyers.

What Happens Next?

The Council of Ministers' approval is the next step, not the end of the process.

The new texts now face parliamentary scrutiny through the Diputación Permanente.

The Government is asking lawmakers to validate the measures after the previous versions were rejected by the full Congress.

Until that process is completed, the different measures should not all be treated as fully operational.

For Ibiza and the Balearic Islands, where housing affordability and access to homes have become major political and social issues, the outcome of this new parliamentary process could have important implications for both prospective buyers and renters.

For now, the confirmed development is that the Government has reintroduced its housing package and committed €10 billion to the TU CASA first-home loan mechanism, while the remaining measures continue through the parliamentary process.