Spain’s proposed 100% tax on non-EU property buyers: what it means for the market, including future residents

The Spanish government recently proposed a 100% tax on property purchases by non-EU non-residents. This bold measure aims to combat the country’s housing affordability crisis, but it has raised concerns among buyers, sellers, and those planning to relocate to Spain.

At Casa Select, we’re committed to helping our clients navigate these potential changes. Here’s a closer look at what this proposal could mean for everyone involved in the real estate market.

Who is affected by the proposal?

The tax specifically targets non-EU citizens who do not reside in Spain. However, its impact may vary depending on the buyer’s circumstances:

? Non-EU non-residents: Those purchasing properties as investments or second homes are directly targeted by this tax, potentially doubling their property acquisition costs.

? Non-EU buyers planning to become residents: Individuals looking to purchase property as part of their relocation and residency process may face complexities, but they could avoid the tax if they establish residency in Spain during or before the transaction.

? EU citizens and current residents: These groups are unaffected by the tax, but they may see changes in market dynamics.

Potential impact on buyers

Higher costs for non-residents: Non-EU non-residents will find the market less accessible due to the additional tax burden, possibly reducing the appeal of Spanish real estate for this demographic.

Opportunities for residents and EU buyers: With fewer competing buyers, EU residents and those relocating to Spain may find it easier to secure properties, potentially at more favorable prices.

Residency status becomes critical: Buyers intending to move to Spain should prioritize aligning their residency plans with their property purchases to avoid potential tax implications.

Potential impact on sellers

Decreased demand: Non-EU non-residents often represent a significant segment of the market, particularly in high-demand coastal areas. A reduced buyer pool may result in longer selling times or pressure on property prices.

Market adjustments: Sellers may need to shift their focus to attract EU citizens, current residents, or buyers planning to relocate and establish residency.

Increased negotiations: With fewer buyers, sellers might need to adopt more flexible pricing strategies.

Why the proposal is unlikely to pass

The current political landscape in Spain makes it challenging for this proposal to gain parliamentary approval. The government does not hold a majority, and many stakeholders, including real estate professionals and international organizations, have raised concerns about the measure’s potential economic repercussions. As a result, most experts agree that the tax is unlikely to pass in its current form, though discussions may lead to modified versions or alternative policies.

How Casa Select can help buyers and sellers

Whether or not the tax becomes law, Casa Select is committed to helping you navigate the evolving market:

For buyers: We provide guidance on the best opportunities, connect you with legal and tax advisors, and help you strategize for a seamless property purchase—whether you’re an EU citizen, a non-EU resident, or planning to relocate.

For sellers: We create targeted marketing strategies to attract buyers in a shifting market and help position your property for success.

Adapting to the evolving market

Even if the tax doesn’t pass, the proposal highlights the importance of staying informed and adaptable in a dynamic real estate landscape. Casa Select is here to help you navigate these changes and seize opportunities as they arise.

Whether you’re buying, selling, or planning to relocate, Casa Select is here to provide expert advice and tailored solutions. Contact us today to discuss your property needs and learn how we can help you thrive in Spain’s real estate market.