In a bold move to combat the worsening housing crisis, Spain has proposed a 100% tax on property purchases by non-EU citizens living outside the EU.
The measure, announced by Prime Minister Pedro Sánchez, aims to curb foreign real estate investments, which drive up housing costs and limit availability for locals.
“We cannot allow speculative purchasing to worsen the housing crisis. This measure should ensure that homes are for people, and not just for profit,” Sánchez said at a press conference unveiling the proposal.
The tax, which requires parliamentary approval, is part of a broader package of 12 initiatives aimed at tackling housing affordability. The Spanish government is under increasing pressure to act as property prices continue to outpace income growth, leaving many citizens unable to buy or rent homes.
If introduced, the tax could have significant implications for British buyers, who represent a large part of Spain’s foreign property market post-Brexit. Critics argue the move could deter foreign investment, but supporters see it as a necessary step to protect the domestic housing market.
“This is a crucial step toward reducing inequality and prioritizing housing as a fundamental right,” Sánchez added.
The proposal’s approval remains uncertain as Sánchez’s coalition faces challenges in securing a parliamentary majority.
The Spanish rental market will reach record highs in 2024
According to recent data, Spanish rents rose by an unprecedented 11.5% in 2024, reaching record levels by the end of the year.
The increase has put further pressure on affordability for locals, especially in major urban centers such as Madrid and Barcelona, where demand continues to outstrip supply.
Experts attribute the sharp increase to limited housing availability, increased tourism and increased interest from foreign investors, all of which have increased competition in the rental market.
