What's happened
Spain's Prime Minister Pedro Sanchez has introduced a housing bill aimed at addressing the country's housing crisis. The bill includes a new tax on foreign property buyers, particularly targeting non-EU residents, amid rising real estate prices and shortages in major cities like Madrid and Barcelona.
What's behind the headline?
Key Points of the Housing Bill
- Targeting Foreign Buyers: The proposed tax specifically affects non-EU residents, who purchased 27,000 properties in 2023, with UK citizens being the largest group. This move aims to curb speculation and make housing more accessible to locals.
- Legislative Challenges: Sanchez's minority coalition government faces hurdles in passing the bill, needing support from multiple parties. This uncertainty raises questions about the bill's future and its potential effectiveness.
- Additional Measures: The bill also includes increased VAT on short-term rentals and taxes on real estate investment trusts, alongside efforts to regulate holiday rentals, particularly in tourist-heavy cities like Barcelona.
- Public-Private Partnerships: The government is exploring innovative construction methods to expedite housing development, which could alleviate some of the supply issues in the long term.
This legislation reflects a broader trend in Europe where governments are increasingly intervening in housing markets to protect local residents from the impacts of foreign investment and speculation.
What the papers say
According to the South China Morning Post, Prime Minister Sanchez's housing bill aims to address significant societal issues related to housing access, stating it is one of the largest problems currently faced. Bloomberg echoes this sentiment, highlighting the bill's focus on foreign buyers and the need for legislative support to pass it. The urgency of the situation is underscored by Sanchez's previous announcements and the growing discontent among citizens regarding housing affordability. The contrasting perspectives from these sources emphasize the critical nature of the housing crisis in Spain and the government's response to it.
How we got here
The housing crisis in Spain has intensified, with soaring prices and a shortage of affordable homes. In January 2025, Sanchez announced plans for a new tax on foreign buyers, particularly as discontent grew over property speculation by non-EU residents.
Go deeper
- What are the main features of the housing bill?
- How will this tax affect foreign buyers?
- What challenges does Sanchez face in passing this legislation?
More on these topics
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Pedro Sánchez Pérez-Castejón is a Spanish politician serving as Prime Minister of Spain since 2 June 2018. On 7 January 2020, Pedro Sanchez was confirmed by the Congress of Deputies as Prime Minister with a lead of just two votes, heading the first coa