Walter Finch
A LEADING Costa del Sol property group has warned Spanish Prime Minister Pedro Sanchez’s proposed new tax measures targeting non-EU property buyers could damage one of Spain’s key economic sectors.
The Leading Property Agents of Spain (LPA), an association based in Marbella, has criticised a raft of plans to increase taxes for non-EU buyers, impose new levies on holiday homes, and scrap the ‘golden visa’ scheme for foreign investors.
In a strongly-worded statement, the association pointed to other countries, where similar measures have failed to achieve positive results.
READ MORE: PM Pedro Sanchez to raise tax on Airbnb tourist flats and non-EU residents buying property in Spain
“The proposed measures are not grounded in solid evidence and have failed to deliver results in countries like Canada and New Zealand, where similar strategies were tried,” the LPA said in a statement.
“Instead, they penalise investment and fail to address the structural issues of the housing market.”
They also warned the ‘populist’ proposals could face legal challenges in European courts for discriminating based on nationality.
READ MORE: Pedro Sanchez now wants TOTAL ban on non-EU home purchases in Spain with two exceptions
The LPA argued that foreign investment is ‘fundamental to economic growth and sector stability’ and proposed alternative solutions to Spain’s housing challenges.
These include promoting affordable rentals through tax incentives and public guarantees for landlords who charge reasonable prices.
Meanwhile, the existing housing stock could be renovated through government programs, while other land could be freed up for development with a focus on affordable housing for younger generations.
“The government should prioritise responsible policies that benefit citizens and investors alike, rather than fuelling discontent with divisive rhetoric,” the LPA urged.
These developments come as the Costa del Sol continues to attract significant foreign investment in its property market, with the region remaining a preferred destination for international buyers – despite political uncertainties.
Sanchez has justified the proposed non-EU ban, which is still in the discussions stage, on the grounds that it would curb speculation driving up house prices to unaffordable levels.
Sanchez said: “We are going to propose to ban non-EU foreigners from buying houses in our country, in cases where neither they nor their families reside here and they are just speculating with those homes.”
However, with foreign purchases being dominated by nationals from EU member states – namely Germany and the Netherlands – it’s debatable how much impact the measure would have.
German buyers dominate many areas, particularly in the Balearics where they account for over 50% of foreign interest in some locations.
Meanwhile, Dutch buyers show strong interest in Alicante province, particularly in Moraira where they make up 27% of searches.
A few of us came to the same conclusions days ago, as readers would have seen reading comments in this section.
You don’t need to be a brain surgeon to work it out!
We have been saying this for many years. Do you allow links to show you why?