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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

#241

Post by WalterBright »

jfghi wrote: post #118
WalterBright wrote: post #32

Earlier quoted context omitted.

In order to justify a corporate purchase, there needs to be a return on investment. A vacant property is not that.

I disagree. The large corporations in total own hundreds of thousands of homes in their portfolios. The value of renting or selling can be boosted significantly by introducing scarcity on the margins between supply and demand. A vacancy of a small percentage of the portfolio can ensure the rest of the portfolio is worth much more. To elaborate a little further, it’s not necessarily the act of having it sit empty but…

Pricing high just means opportunities for others to undercut it and snatch away the business.

Check out those owners of vacant office buildings lately. Oops.

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

#242

Post by WalterBright »

iforgot22 wrote: post #136
WalterBright wrote: post #35

Earlier quoted context omitted.

> property isn't a productive asset It is when you rent it out.

In theory, the market should push owners to rent when prices stabilize. Eventually. In the meantime, it's possible that some foreign investors don't care too much about the opportunity cost. I think some kind of vacancy tax is the only good way to fix this if it's a real problem.

Vacant property is quite a drain on one's pocketbook.

Try it some time.

When I move and sell the old house, I underprice it to sell it as fast as possible. The other sellers do not seem to understand the time value of money, the maintenance cost, the taxes, the vandalism, and the squatter risk. Oh, and your insurance goes up if the house is vacant.

And never mind having $800,000 or so tied up as a millstone around your neck when you could be investing it in stocks.

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

#243

Post by ryan_lane »

sadeshmukh wrote: post #236
ryan_lane wrote: post #227

Earlier quoted context omitted.

Where's the source for your assertion? You're making a claim that foreign investment is beneficial with no source, but then requiring one when someone disagrees with you?

A theoretical argument was countered with an assertion - it's plausible that investment -> lower risk, but there is no reasoning to get "foreign investment is focused on X area".

"What that foreign capital also does is lower risk and thus capital costs for development and improvement."

Not a theoretical argument. An assertion.

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

#244

Post by matt-p »

zdragnar wrote: post #130
matt-p wrote: post #91

Earlier quoted context omitted.

I think the ship has sailed, but regardless isn't it all meaningless? Surely they can setup a company to get around it, or will be ban all foreign ownership of shares too?

Land is a public good, insofar as "buying" the land still comes with obligations to the state (paying taxes, conforming to building codes and zoning regulation, etc). Just because you "own" it doesn't actually mean you can do as you please. Given all of that, it is not unreasonable to limit or outright prohibit foreign ownership of land, or ownership of land by companies which are not majority-locally controlled.

It's interesting, I just think the second order effects might be a bit scary.

Having said that I guess for FDI there's always the option of getting a local company to "JV" with like in China.

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

#245

Post by mytailorisrich »

ETH_start wrote: post #154
WorkerBee28474 wrote: post #129

Earlier quoted context omitted.

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 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.

The issue not mentioned because it is a very politically charged topic is that, as I understand, net migration to Spain is at an all time high.

This is bound to push housing prices up.

Hitting foreign investors is easier politically but may not have much effect.

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

#246

Post by alecco »

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.

But the foreign investors are doing it because the housing market has an artificial supply shortage. They are buying into a cornered market.

Of course, full deregulation is not a fix as seen with the condos built in ridiculous locations back in the sub-prime mania.

It would be good to have a reasonable plan. Sadly the plans for making livable neighborhoods was hijacked by the "15 minute city" WEF-style politicians. The Netherlands had some very interesting projects that went pretty well.

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

#247

Post by omnimus »

icar wrote: post #226

Houses should not be an investment, but only used for what they are: a place to live. That's directly opposed to why someone not local would buy them. This fall short, it should be straight up forbidden, also for EU residents (who are a big issue as well, looking at you German and French people that buy houses, leave them empty all year but 1 month and/or don't even learn the language and traditions of that place)

I think EU is ok as many people actually live somewhere else thanks to EU laws.

What should get hard taxed is owning multiple homes. There are people with 100s flats not even under a company but an individual. And companies that do own homes as business should be stevards of properties with max profit margins - it can be good business but not unhinged money printer it is in becoming everywhere.

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

#248

Post by alecco »

saguntum wrote: post #219

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 enfo…

> one of the national papers of record, El País

El País has basically become the socialist government's PR department.

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

#249

Post by bborud »

ilya_m wrote: post #76
bborud wrote: post #2

Would it work or would it just make things worse?

Easy! It won't work and it would make things worse.

I was hoping for someone to share a bit of insight on why they think so.

(I too suspect it will not achieve the desired outcome, but I had hoped someone could shed some light on the particular conditions in Spain rather some default answer)

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

#250

Post by rednafi »

ralsnop wrote: post #193
rednafi wrote: post #176

The issue is that countries expect foreigners to bring in money, earn a lot, and pay taxes at the 90th percentile, but they’re (the locals) reluctant to share resources in return. A 100% taxation model turns it into a one-way street. Sure, if you don’t need foreign investment, you can afford to do that. But let’s be real—welcoming foreigners isn’t an act of charity. Governments usually do it because foreigners are of…

If India had 25% white EU members similar to Sweden having 25% migration background members (mostly from Africa or the Middle East), perhaps Indians would get a tiny bit protectionist. The accusation that locals are reluctant to share resources is offensive at this point. There is no space and people can barely afford to pay rents. Meanwhile there are "golden visas" to Portugal or Cyprus where rich Chinese can gain e…

I completely understand the need for protectionism. That said, Sweden's immigration policy ranks among the worst in Western countries. I'm not saying there shouldn't be any pushback; rather, my point is that these policies are exploitative on both ends. Why bring in refugees in the first place? And if you do, why bring them in en masse?

The US handles a much larger number of migrants each year and consistently attracts the cream of the crop. I'm not saying the US doesn’t have issues with migrants, but during my time living there, I didn’t find the situation as severe as in Germany, Sweden, Spain, Portugal, or Italy.

Europe's immigration policy is broken. Many immigrants end up draining the social welfare system, overcrowding service providers, and causing religious tensions. But let’s be honest: everyone knows which group is primarily responsible. It’s extremely difficult for that group to enter the US. At the same time, it’s much easier—though still not trivial—for skilled migrants to move there. In Germany, the situation is the opposite: it’s trivial to enter as a charity case but much harder as a skilled migrant.

If you can afford to reject immigration, you're free to do so. America can’t, and they’re profiting from it. But why adopt such a self-sabotaging approach, bringing in the worst of the crop and then blaming them for the country’s woes? That’s the part I can’t understand.

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