Spain is preparing to implement a 100% tax on property purchases made by buyers outside of the EU, in an attempt to better handle the country's mounting housing crisis, by decreasing foreign purchases.
This is one of 12 measures that Prime Minister Pedro Sánchez has recently introduced in an effort to try to improve the housing crisis.
Spain has been facing a lack of affordable properties to rent or buy, following soaring property prices, exacerbated by rising inflation and interest rates. The situation has led to anger and discontent among residents, made worse by the lack of the building of new homes which has meant housing demand is considerably outstripping supply, thus pushing prices up further.
Spain's reputation as popular second-home destination at risk. Spain has long been one of the most popular destinations for second and holiday homes, especially in areas such as Barcelona, Ibiza and Marbella. A significant portion of the interest comes from US, UK and Moroccan buyers while interest from Venezuelan and Mexican buyers has grown over the past few years.
Opponents of the plan argue that such restrictions could have a major impact on the country's tourism sector which is a major contributor to the country's economy. Other measures proposed to tackle the housing crisis include increasing social housing supply, as well as tightening restrictions on short-term rental apartments.
