Brits could face 100% tax on homes in Spain

Spain is planning to impose a tax of up to 100% on real estate purchased by non-residents from countries outside the EU. 

During his speech at the closing ceremony ‘Housing, fifth pillar of the welfare state’ held in Madrid, Spanish Prime Minister Pedro Sanchez announced a battery of 12 new measures to solve the housing problem in Spain. 

Sanchez said: “The West faces a decisive challenge if it wants to avoid becoming a society divided into two classes: rich landlords and poor tenants.

“We are facing a serious problem, with enormous social and economic implications, requiring a decisive response from society as a whole, and with public institutions at the forefront.”

According to the Spanish PM, in 2023 alone, 27,000 houses and flats have been bought by non-residents from outside the EU “not to live in” but “to make money from them”. 

Sanchez reiterated that the housing problem has become “one of the main challenges facing European societies including Spain”, explaining that rent prices have risen by 48% in the past decade, which justifies the introduction of the “unprecedented” measures. 

Among them, there is a crackdown on foreign buyers through the implementation of a 100% real estate tax, which is set to affect thousands of foreigners, including British expats.

Sanchez did not offer details on how the tax would work or whether it would be approved by Parliament. 

In April last year the Spanish government had already abolished the ‘golden visa’ scheme, which provided foreign investors with a fast-tracked residency in exchange for buying property worth €500,000 (£428,000) or more.