Pedro Sánchez Launches €23 Billion 'España Crece' Fund Amid Housing Irregularities Scandal

On February 21, 2026, Spanish Prime Minister Pedro Sánchez announced the launch of the "España Crece" fund, a major initiative designed to bolster Spain’s housing sector by mobilizing up to €23 billion from public and private sources. The fund aims to finance the construction of 15,000 homes annually and forms part of the larger Plan de Recuperación, Transformación y Resiliencia, which seeks to drive economic recovery and growth. Backed initially by €10.5 billion from the Recovery Plan, the initiative is expected to generate an overall investment of around €120 billion through leveraged resources via the Instituto de Crédito Oficial (ICO).

Sánchez highlighted that the fund will prioritize key sectors including housing, energy, digitalization, and infrastructure, aiming to sustain the country’s GDP growth of 2.8% seen in 2025. The government intends for the fund to attract private investment while maintaining transparency and accountability, demonstrating its commitment to transforming economic challenges into growth opportunities.

Despite the promising government initiative, recent scandals have tainted the landscape of protected housing in Spain. In Alicante, a serious controversy emerged involving approximately 140 protected homes in the Les Naus project, the first such initiative in two decades. Investigations revealed irregularities with municipal officials implicated, including Rocío Gómez, the Urban Planning Councilor, and María Pérez-Hickman, a director general at Alicante City Council, both of whom resigned following revelations of their involvement as beneficiaries of these homes.

Further troubles were reported in Málaga where the PSOE filed a complaint alleging irregularities in the allocation of protected housing on Avenida Ingeniero José María Garnica. These delays have negatively affected 35 families awaiting their homes for over two years. In Extremadura, administrative errors hindered the Habita Extremadura housing plan due to urban planning mistakes.

Meanwhile, a brighter note comes from Alzira, Valencia, where the construction of 440 homes (including 123 protected ones) began — the first public housing effort in 20 years — causing young people to queue for days to access affordable housing.

The 'España Crece' fund arrives at a critical moment, offering a substantial investment boost to alleviate Spain’s housing deficit while spotlighting the urgent need for integrity and sound management in protected housing projects across the country.