Hillside houses outside Marbella on the sunny coast, Costa del Sol, Spain.
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Spain plans to introduce a 100% tax on homes bought by non-EU residents to tackle the country’s entrenched housing crisis.
Spanish Prime Minister Pedro Sanchez on Monday proposed a package of measures aimed at easing the shortage of homes, high rents and rising house prices across the country, with foreign home buyers and mass tourism believed to be contributing to the pressure on real estate.
Speaking at the forum about it, the socialist leader Sanchez he said that access to housing is one of the main challenges facing Spanish society and that there was a risk of division between communities.
“The West faces a decisive challenge: not to become a society divided into two classes, that of rich owners and poor tenants,” he said, noting that house prices in Europe have risen by 48 percent in the past decade, almost twice as much as household income.
“We are facing a serious problem, with enormous social and economic implications, which requires a decisive response from society as a whole, with public institutions at the forefront,” he said, according to comments published by the government.
Prime Minister Pedro Sanchez speaks during the ‘Housing, the fifth pillar of the welfare state’ forum, organized by the Ministry of Housing and Urban Agenda, at the Railway Museum, January 13, 2025 in Madrid, Spain. During the meeting, the Prime Minister made a new announcement about housing, and highlighted access to housing as a key issue within the legislature, amid the escalation of real estate prices, especially in large cities.
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Announcing 12 reforms designed to tackle the crisis, Sanchez said the government’s proposals included a plan to ensure tourist accommodation was taxed “like a business” and a proposal to levy a 100 per cent tax on the value of homes bought by non-EU residents .
Such changes, he said, would help make housing more accessible and affordable across Spain.
“Non-residents of the European Union bought 27,000 apartments in Spain [in 2023]. They did it not to live, but to speculate, to make money with them, something we cannot afford in the context of scarcity,” Sanchez said at the forum “Housing, the fifth pillar of the welfare state” in Madrid on Monday night, in comments published by El Periodico and translated by Google.
“The progressive coalition government has always accepted foreign investments, but we want them to be productive, stimulate innovation and create new jobs, and not be used for speculation, as if it were a financial asset or a bank deposit,” he added.
Spain, holiday homes, tax
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Other measures introduced by Sanchezwho leads the left-wing Spanish Socialist Workers Party and a coalition government that includes the far-left Sumar party, has included plans to provide tax breaks to landlords by offering affordable rents and greater protections for existing tenants.
He announced plans to build more public housing and ensure that existing social housing remains state-owned. A program of renovation of empty houses will also be launched so that they can be rented at affordable prices, he said.
The prime minister did not provide any further details on how the tax on non-EU home buyers would work or give any indication of when such proposals might be brought to parliament for approval.
Housing shortages, rising prices — and a strong perception that vacation home owners and vacation rentals are exacerbating the problem — have sparked a strong public backlash in Spain, as well as unrest in tourist hotspots along the southern coast, the Canary Islands and in cities including Barcelona and Alicante.
Reports on tourists are told to “go home” and there have been incidents of foreign visitors being sprayed with water guns, and local residents are calling on the authorities to tackle “excessive tourism”.
A tourist takes a photo of a message in Park Guell. Anti-tourism organizers have called for a 50 percent cut in daily ticket sales at the site, one of Barcelona’s top tourist attractions.
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However, the Spanish economy relies on tourism to drive growth and create jobs, with the sector accounting for more than 13% of GDP and about three million jobs. In the first 11 months of 2024, the number of international tourists who arrived in Spain reached the highest figure ever, exceeding 88.5 million, according to data from the state statistics agency, INE.
“Tourism is not only boosting consumption spending, but high occupancy rates are also fueling record investment in hotels,” Maartje Wijffelaars, senior eurozone economist at Rabobank said in the analysis last September.
“We project that GDP growth in Spain will soften somewhat going forward, as growth in the tourism sector is forecast to lose some momentum. However, growth is expected to remain strong and higher than in the Eurozone in the coming quarters and years, and that it will amount to 2.7% [in 2024]1.9% in 2025 and 1.5% in 2026,” she said.
