Just 10 days ago the Spanish prime minister advocated a 100% tax on homes purchased by non-EU citizens – but now it looks like he wants to go further with an outright ban.

Premier Pedro Sanchez said he would propose to ban purchasers from outside the European Union from buying properties, labelling such buyers not as visitors or consumers, but as “speculators”.

“We will propose to ban these non-EU foreigners who are not residents, and their relatives, from buying houses in our country since they only do so to speculate” Sanchez has told a political rally. 

Housing has become a major issue in Spain, made worse by the wafer-thin majority Sanchez has in the country’s parliament. In recent years long-term rents have increased as landlords, facing greater restrictions and higher taxes, have in some cases transferred their properties to the short-let market.

The country’s Central Bank recently estimated there could be a deficit of half a million houses in Spain by the end of this year.

A respected analyst of the Spanish housing market – Mark Stucklin, who runs the Spanish Property Insight service – says that non-resident buyers from outside the EU purchased 18,648 homes in Spain in 2023, a 7% year-on-year decline. This is based on figures from the Spanish notaries’ association. 

He adds that over the past decade, this segment’s level of investment has been shrinking slowly, with 2023 marking one of the lowest volumes outside the pandemic years. And he says specifically: “A declining growth pattern does not support the government’s claim that this segment is exacerbating the housing crisis. In fact, it appears to be losing relevance.”

He goes further, suggesting that official data from Spanish notaries is hard to reconcile with figures quoted by Prime Minister Sanchez, when describing non-EU purchasing levels and impact.

Stucklin concludes: “In 2023, this segment (non-residents from outside the EU) represented just 14% of the total foreign buyer market, a decline from its 25% share in 2014-2015. 

“The total foreign market, which is dominated by EU expats and second-home buyers from countries like France and Germany, has grown much faster than this segment. Given its declining share, this segment is unlikely to be a primary driver of the housing crisis.”

There is a detailed analysis of the foreign purchaser activities in the Spanish market on Stucklin’s website. You can see it here: https://www.spanishpropertyinsight.com/reports/non-resident-buyers-from-outside-the-eu/