A topical article in yesterday’s Guardian by María Ramírez, deputy managing editor of elDiario.es, points to the opportunities and limitations of the Spanish government’s plan to tax non-EU citizens wishing to buy a Spanish property, at 100% of the property’s value.
In essence the problem is the rapidly increasing price of property driven by the rapid growth of the Spanish economy, increased immigration which is helping to fuel that growth, and the almost insatiable demand for tourist accommodation in this beautiful and sunny land.
The cost of renting in cities rose by around 30% between 2015 and 2022, forcing many to move to their outskirts, and in popular tourist areas – such as Valencia, Alicante or here in Málaga – rents have risen by some 40%.
In order to ease the rise in house prices and increase the supply, the government has proposed, among other measures, a tax of up to 100% of the real estate value of houses purchased by non-EU buyers (so, including post-Brexit Brits!) who are not residents of Spain, many of whom the government is assuming buy a property in order to let.
The article points out, however that while the policy might alleviate the pressure in a few holiday areas, it will not prevent EU-based speculators from stepping in and buying up properties and is further complicated by Spain’s decentralised political structure. Antonio de la Fuente, managing director at Colliers International Spain, told the BBC´s World Business Report that he didn’t think this approach capable of solving the real problem. “We all agree we are in a problem of not enough supply and we need to produce new supply to give people migrating from other parts of Spain to big cities like Madrid, Valencia, [and] Malaga a new home. But this will be a drop in the ocean in my opinion and there will be other alternatives that will have a higher impact on the housing market.”
“Making British visitors pay more may bolster Treasury revenues and deter some – not the super-rich – from buying houses”, says Ms Ramirez. “But it is far from a solution to Spain’s housing pressures. Millions of houses need to be built”.
Read Ms Ramirez’ Guardian article here.
Read the BBC’s article here.