Towards New Trade-Offs Between Housing and Pensions? Funded Pensions and Rental Housing Decommodification

The fate of pensioners and tenants have become intertwined in the contemporary housing crisis. In the past two decades, pension funds have increasingly participated in rental housing equity investments, driven by the pursuit of higher yields and portfolio risk diversification. These investments are largely mediated by asset managers that operate across the globe. Much hope has been placed on the potential of pension funds as “patient capital” in socially responsible and green investments. Yet, building on the literature that has theorised the relationship between housing and pensions systems, we posit that a trade-off is emerging between funded pensions and rental housing decommodification. Whereas enhancing the returns on pension fund investments puts pressure on housing affordability and tenure security for tenants, rental housing decommodification, be it through collective ownership or rent controls, restricts the space for pension monies to grow. To illustrate the transnational dimension of this trade-off, we centre our analysis on Spain, a country with an established pay-as-you-go pension regime that has nevertheless received substantial foreign pension fund investments in rental housing. Drawing from data on institutional investors and grey literature, we bring the pension fund geographies and political economies shaping the Spanish rental housing regime into relief, as well as suggest their broader generalizability beyond the case. Our transnational methodological approach contributes to better understanding the political economy of welfare regimes in an era marked by financialisation.