Carlos Ramallo, CEO of the law firm Ramallo Abogados, reviews the Spanish government’s proposal for 100% tax for property buyers outside the EU.
Proposed tax and purchase restrictions for non-resident home buyers in Spain
On 13 January 2025, Spanish Prime Minister Pedro Sánchez proposed introducing a 100% tax on property purchases made by non-residents from outside the EU. Later that month, Sánchez discussed the possibility of banning non-EU citizens from buying homes in Spain.
These initiatives are part of a broader strategy to address the country’s housing crisis and ensure better access to affordable housing for residents.
The background to the measures
Prime Minister Sánchez has expressed concern that many foreign investors are buying property in Spain solely to generate profits, exacerbating the housing shortage. According to Bloomberg, the shortage of affordable housing in Spain is estimated at approximately 200,000 units annually.
Who could be affected by the proposed measures?
The proposed doubling of property tax will apply to non-residents who stay less than 183 days a year in Spain.
Property buyers from countries outside the EU/EEA will face additional financial burdens when purchasing property in Spain.
Facts and statistics
In 2023, 27,000 properties in Spain were purchased by non-residents from countries outside the EU/EEA.
Foreign buyers made up approximately 15% of the property market in 2023, with 87,000 transactions out of a total of 583,000.
Legislative process and uncertainty
It is important to emphasize that these measures are only proposals and require parliamentary approval to be implemented, which could be challenging given that Sánchez’s party is in the minority in the coalition government.
Although there is uncertainty about whether these proposals will be adopted, they have already raised concerns among both buyers and sellers in the Spanish property market.
Important points
The proposal is only at an early stage.
The measure has not been passed into law. Any proposal in Spain must go through an extensive legislative process, including several levels of review, discussion and potential amendments.
Long implementation process.
Even if the measure were to be passed, it would likely take months or years to be implemented. This means that there will be no immediate effect on the property market.
Benefits for EU/EEA citizens
As EU/EEA citizens, you will not be affected by the proposed restrictions. These measures are aimed at non-resident buyers from countries outside the EU. Your rights and opportunities to buy property in Spain remain unchanged.
If implemented, the measures could reduce competition from non-EU buyers, which could provide more favourable conditions for EU citizens, especially in areas of high demand.
Commitment to attracting foreign investment.
Spain remains committed to attracting foreign investment, and any measures are likely to balance investment considerations with the need to address the housing shortage.
Stable legal framework.
Spain maintains a stable legal framework for EU/EEA citizens, in line with EU principles, safeguarding their rights to invest and own property.
Our commitment
We are closely monitoring the development of these proposals and will keep you informed of any changes. Our aim is to ensure that you feel safe and well informed when investing in property in Spain.
If you have any questions or would like to discuss how this may affect your specific plans, we encourage you to contact us. We are ready to assist and guide you at every stage of the process.
