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Spain proposes 100% tax on homes bought by non-EU residents

theguardian.com

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Re: Spain proposes 100% tax on homes bought by non-EU residents

#211

Post by creer »

WorkerBee28474 wrote: post #129
louison11 wrote: post #122

Blaming foreigners for housing prices is misdirected. The real culprit is slow bureaucracy & zoning laws making it impossibly slow to get a permit to build anything in both Spain and Portugal. Both of these countries for example have so many abandoned houses needing to be renovated, and so many foreigners coming in with money to do it - but they can never do it because you can't get a permit in literally forever... I…

No, that argument assumes you can only blame 1 thing at a time. Even if the bureaucracy is the worst offender, every foreigner buying a house still results in 1 less house for Spaniards. Sure, fix bureaucracy, but don't pretend foreign purchases have zero effect.

> every foreigner buying a house still results in 1 less house for Spaniards

Absolutely not. For example my impression is that foreign demand has been great for the construction industry, both small and large, both in Spain and Portugal. Paying lots of people directly and still more indirectly. The presence of all these buildings that needed renovation (or demolition) shows that the population previously could not afford to use them. Dumping money in the economy causes some inflation, yes, but it also pays many people and allows still more to enter the field.

Re: Spain proposes 100% tax on homes bought by non-EU residents

#212

Post by ETH_start »

mkoubaa wrote: post #162
ETH_start wrote: post #154

Earlier quoted context omitted.

Every foreigner buying a house is supplying capital for one additional house to be built, and some portion of those additional houses will be unoccupied by the foreigner most of the year and available on the rental market for locals. Even if it's just short term rentals, that means more affordable vacations and temporary housing for the domestic population.

This is one of those arguments that at face value seems quantitatively sound but doesn't survive first contact with reality

And your claim that it doesn't survive first contact with reality is based on you correlating high volumes of foreign investment with lack of housing affordability and assuming that the former is causing the latter, when the correlation is really due to a confounding factor.

Re: Spain proposes 100% tax on homes bought by non-EU residents

#213

Post by honestSysAdmin »

louison11 wrote: post #122

Blaming foreigners for housing prices is misdirected. The real culprit is slow bureaucracy & zoning laws making it impossibly slow to get a permit to build anything in both Spain and Portugal. Both of these countries for example have so many abandoned houses needing to be renovated, and so many foreigners coming in with money to do it - but they can never do it because you can't get a permit in literally forever... I…

Bloated/unnecessary bureaucracy is essential to the bribe collection process.

Re: Spain proposes 100% tax on homes bought by non-EU residents

#214

Post by bdangubic »

iforgot22 wrote: post #208
bdangubic wrote: post #199

Earlier quoted context omitted.

where exactly does a house make no return, especially in say last decade/15 years? I bought three houses in the last 20 years, one doubled, one up 70% and one 40% (still occupying it)

In the US, not many places. But that's the complaint from some people.

give me some places where it is not and we’ll look at zillow or whatever public data there is for a given region. unless we are talking like rural-no-is-around-for-miles perhaps but otherwise properties over the last 10-15 years have appreciated

Re: Spain proposes 100% tax on homes bought by non-EU residents

#215

Post by throwaway2037 »

CommanderData wrote: post #70
rolothrow wrote: post #47

Earlier quoted context omitted.

Totally anecdotal, but I live in the largest city in Spain, and even in my residential area (as opposed to the touristy spots) every week I can see ads for "we buy your house, paid upfront over market value, Chinese investors". Posters in walls, flyers in windshields and so on.

This is excellent, assets like property don't grow on trees and needs to be protected from foreign investors. Absolutely need something like this in the UK.

Do you think it is bad when foreign investment corporations buy commercial property? This is very common in London. Or only residential property? And, were you upset when foreign capital (Malaysian, mostly) helped to redevelop Battersea Power Station?

Re: Spain proposes 100% tax on homes bought by non-EU residents

#216

Post by Terr_ »

gruez wrote: post #96
Terr_ wrote: post #71

Earlier quoted context omitted.

Perhaps if they were mobile homes. :p The comparison breaks down a little further with cases where the foreign owners just rent the home out.

>Perhaps if they were mobile homes. :p Tourism counts as an "export" even though everything stays within the country's borders. >The comparison breaks down a little further with cases where the foreign owners just rent the home out. So... an investment tax?

Hmmmm, kinda? AFAIK usually an investment tax is on gains, so "you must pay X% when purchasing an the capital" tax seems pretty unusual, or perhaps it exists under some other term. It's not quite a usual sumptuary tax either...

I'm assuming it's more about ownership than usage, since it doesn't hit local landlords, and there are already visa/immigration systems if it were a matter of people-movement.

Re: Spain proposes 100% tax on homes bought by non-EU residents

#217

Post by throwaway2037 »

egwor wrote: post #19
Retric wrote: post #14

Earlier quoted context omitted.

Meaningful is a weasel word here. Even 0.1% price increase which would be impossible to measure directly still adds up across the entire housing sector. But, equally important is simply the number of natives prevented from buying the home they want because someone is getting a vacation property.

I think I read 20,000,000 need housing and this will impact 20,000 per year so broadly the numbers are inline.

How can 20M be even remotely correct? Spain has a total population of about 48M.

Re: Spain proposes 100% tax on homes bought by non-EU residents

#218

Post by Gibbon1 »

WorkerBee28474 wrote: post #129
louison11 wrote: post #122

Blaming foreigners for housing prices is misdirected. The real culprit is slow bureaucracy & zoning laws making it impossibly slow to get a permit to build anything in both Spain and Portugal. Both of these countries for example have so many abandoned houses needing to be renovated, and so many foreigners coming in with money to do it - but they can never do it because you can't get a permit in literally forever... I…

No, that argument assumes you can only blame 1 thing at a time. Even if the bureaucracy is the worst offender, every foreigner buying a house still results in 1 less house for Spaniards. Sure, fix bureaucracy, but don't pretend foreign purchases have zero effect.

I have various thoughts. The rough one is that investors driving up the cost of housing increases the countries labor costs. Which harms it's competitiveness. Reduces workers standard of living. Which also causes headaches for political leaders.

Foreign investors rub salt in the wound by moving their gains outside the country. And the real risk that they will flee when there is any sort of downturn making it worse.

My opinion giving those guys the middle finger isn't unreasonable.

Re: Spain proposes 100% tax on homes bought by non-EU residents

#219

Post by saguntum »

The English language reporting on this reform proposal is not comprehensive.

Here's an article on it by one of the national papers of record, El País: https://elpais.com/espana/2025-01-13/sanchez-anuncia-una-int...

Some interesting tidbits from the article:

- Some local governments, which are run by a party opposed to the governing national party, oppose the existing laws regarding price regulation and refuse to enforce price caps. This is possible because Spain has a lot of power devolved to local governments. The proposal attempts to side-step local governments by giving property owners a 100% income tax rebate if they abide by national price regulations for their properties. It essentially incentivizes individuals to enforce what regional governments are supposed to be implementing.

- Spain's public housing inventory is low compared to other European counterparts - Spain's at 2.5%, France at 14%, Netherlands at 34%.

- There are some comparisons to the construction rates during the 2000s housing bubble and how the inventory has shifted between single and multi family dwellings.

- The measures include plans to promote prefabricated/modular housing as it is much cheaper to produce at scale.

Sidestepping uncooperative local governments is an interesting technique given their devolved system of government. I would also be curious to see how prefab/modular housing measures develop. If they are combining some old school "price cap / limit foreign investment" strategy with a pro manufactured housing YIMBYism, that would be kind of unique.

From my quick scan of the article, the 100% tax on non-EU residents isn't even reported on. The reform is much more comprehensive and, in my mind, likely to get passed in some form even if the 100% tax gets cut from the final bill.

There are also some less than factual opinion statements like this dropped in the Guardian's article:

> Given his government’s longstanding struggles to pass legislation, one analyst suggested to the Financial Times that the government’s aim was to deter foreign property investors by creating “uncertainty and noise” with a proposal that has slim chances of becoming law.

IMO this is under-selling the current president's political survivability, regardless of what you think of him or his policies. He is currently in power because he convinced a separatist Catalonian party whose leader is exiled from the country to join his coalition.

I'd rather not get into it on HN, but read about his tenure for yourself. The Guardian's article is not a good enough summary of what is being proposed and is not giving thorough enough context.

Re: Spain proposes 100% tax on homes bought by non-EU residents

#220

Post by x0xrx »

bdangubic wrote: post #199
iforgot22 wrote: post #175

Earlier quoted context omitted.

I don't see why this is better than people renting and investing their savings elsewhere, which is how it works with apartments anyway. So you own a house, it makes basically no return, now what?

where exactly does a house make no return, especially in say last decade/15 years? I bought three houses in the last 20 years, one doubled, one up 70% and one 40% (still occupying it)

Do you not see how insane it is to at once 1) demand cheap housing and 2) demand it increases in price at breakneck pace?
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