Last year, Spanish builders finished around 800'000 homes, more than the French, Germans and British combined. Construction now employs one in five Spaniards and contributes 17 percent to gross domestic product. Land the size of three football fields is built on every day, expanding urban space by a quarter in the last decade. In the region of Valencia alone, an area twice the size of Barcelona will be swallowed up if all the current applications are approved. But much of the new stock is likely to stand empty, like 13 percent of all houses in Spain. Speculative cash has helped house prices surge 160 percent in the last seven years, forcing poorer buyers out of major cities to places like Sesena, 40 km (25 miles) south of Madrid. Across an open field from the once-sleepy town of 7'000 people, situated among olive groves on the plains of Castilla la Mancha, stands a forest of cranes building enough apartment blocks to house 50'000 people. The first occupants are due to move in next year but, as yet, the small city has no plans for hospitals, libraries, emergency services, courts or enough schools, says Sesena Mayor Manuel Fuentes. The development will probably not even be connected to water supplies until 2009 or 2010, said Fuentes, a fierce critic of the project. A clear example of what can happen when the economic interests of private promoters come above the general interests of the people, is how Fuentes describes Residency Francisco Hernando', named after the project's billionaire backer. Hernando, who bought the land two weeks before it was rezoned for building, is suing Fuentes, who asked police to investigate how planning permission was granted. When I arrived here nine years ago, all Sesena had was a man with a cart and donkey. The land was here for anyone who wanted it, Hernando told newspaper El Pais recently. Nobody tells me how I should build. Two Sesena councillors resigned earlier in December. They said it was impossible to work due to insinuations and lawsuits, bringing to six the number who have stepped down from the 13-member administration since it ratified the project in 2003.
The Sesena investigation has yet to reach its conclusion. Spain's Prime Minister Jose Luis Rodriguez Zapatero has recognised corruption is a major problem and affordable housing is becoming a hot political issue. In October, the government said it would make it more difficult for town halls to rezone land and promised corrupt officials would be punished.
But campaigners say the proposed law will have little effect so long as town halls continue to rely on building permits for anywhere from a third to more than half of their revenues.
No big political or business name has been dragged into the affair but the sleazy image generated by the building permits scandal is beginning to hurt Spain's international standing. At a dinner with European leaders in October, Russian President Vladimir Putin responded to a question about human rights by snapping back that Spain, with its corruption, had nothing to teach Russia.
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