Graffiti protesting property speculation on the facade of a Mallorca Next Properties real estate agent in Palma de Mallorca, Spain, on Saturday, July 20, 2024. In the Spanish destinations of??Mallorca??and the Canary Islands, locals have been??protesting??to reclaim space from visitors. Photographer: Andrey Rudakov/Bloomberg via Getty Images
Spanish young people have grown increasingly frustrated over the lack of affordable homes (Picture: Bloomberg via Getty Images)

Britons hoping to buy their dream house in Spain will face a 100% tax as part of new plans proposed by the government.

All non-EU residents will face the tax on real-estate purchases, part of a bill that officials say will help ease Spain’s housing crunch.

This means that a Briton buying a €300,000 villa will have to cough up €600,000 instead.

EU citizens, including Germans, who are second to Britons as the highest number of foreign buyers in Spain, will be exempt.

Prime Minister Pedro Sánchez’s Socialist party submitted the bill to parliament last week to promote ‘measures that enable access to housing, since we are facing one of the largest problems our society is currently confronted with’, according to a draft of the bill seen by Bloomberg.

Spain is running out of affordable homes, especially in major cities like Madrid and Barcelona.

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Thousands take to the streets of central Barcelona to demand lower housing costs--both for rent and home ownership--and an end to evictions. The protest, organized by the Tenants' Union and other social groups, is part of a nationwide mobilization across more than 40 Spanish cities. Demonstrators condemn real estate speculation and call for urgent action to guarantee access to affordable housing. According to the Tenants' Union, approximately 100,000 people gather in Barcelona, though the Spanish government's estimate is closer to 15,000. Key demands include a 50% reduction in rental prices, permanent rental contracts, the reuse of vacant and tourist properties, and a ban on eviction companies. Spain's Minister of Housing, Isabel Rodriguez, expresses partial support for the demands, emphasizing the need for inter-institutional cooperation to ensure homes are for living, not speculation. In Barcelona, Catalonia, Spain, on April 5, 2025 (Photo by Albert Llop/NurPhoto via Getty Images)
Thousands took to the streets of Barcelona to demand lower housing costs in April (Picture: NurPhoto)

Protestor carries a sign that reads Stop Eviction. Housing rights demonstration in Zaragoza, Spain as tens of thousands of people protest in nearly 40 Spanish cities to defend the right to housing and against high prices and real estate speculation. (Photo by: Nano Calvo/VWPics/Universal Images Group via Getty Images)
Rents have been rising for years (Picture: VW Pics/Universal Images Group)

Rents have been rising for years amid gentrification, a decline in housing construction and landlords snapping up homes for short-term tourist rentals, like on Airbnb.

Some 412,000 Britons call Spain home, according to 2022 figures.

But the number has only increased since. Britons bought 12,470 Spanish properties in 2023, 30% more than Germans, with 9,611 purchases.

Spain’s cost of living and property prices are lower than the UK, with the country having several British expat communities like Málaga and Alicante.

Hundreds of thousands of people marched in 40 Spanish cities to protest against the rent hikes and lack of cheap homes in April, rattling keys and holding up high flags with the Monopoly man on them.

They chanted: ‘Housing is a right, not a business.’


Hundreds of thousands of Britons live in Spain (Picture: Getty Images)

Spain's Prime Minister Pedro Sanchez gestures as he delivers a speech during a press conference following a council of Ministers' meeting at the Moncloa Palace in Madrid on April 22, 2025. (Photo by JAVIER SORIANO / AFP) (Photo by JAVIER SORIANO/AFP via Getty Images)
Pedro Sanchez announced the 100% tax in January, one of 12 policies to give Spanish people a better chance at joining the property ladder (Picture: AFP)

Sánchez in January described the lack of housing as one ‘of the main challenges facing European societies, including Spain’.

He outlined 12 ‘forceful and unprecedented’ measures to offer more housing, better support buyers and more tightly regulate the market, including the 100% tax.

The measures also include tax breaks for landlords who lower rents and plans to build low-cost housing. The legislation, if passed, would increase VAT on short-term rentals and hike taxes on publicly-listed real estate investment trusts.

Foreign business workers or professional workers based in Spain will not be affected.

MADRID, SPAIN - OCTOBER 17: A real estate agent on October 17, 2024, in Madrid, Spain. Home sales and purchases by foreigners increased by 1.8% year-on-year in the first half of 2024, reaching 69,412. With respect to the total number of sales, those made by non-nationals accounted for 20.4%. A total of 58.2% of the transactions carried out by foreigners were executed by residents and increased by 4.2% year-on-year. On the other hand, those carried out by non-residents represented 41.8% of the total and decreased by 1.4%. (Photo By Marta Fernandez Jara/Europa Press via Getty Images)
Whether the bill will be approved by parliament is unclear (Picture: Europa Press/Getty Images)

Last year, the average cost of renting a flat in Spain was €984 per month, up from €553 in 2014, a 78% increase.

The highest rent increase has been seen in the Balearic Islands, known for their blue-green waters, with a 158% rise over the past decade.

Sánchez, speaking at an event in Madrid called ‘Housing, fifth pillar of the welfare state’, stressed that housing in Europe is ‘unfair’.

‘The West faces a decisive challenge if it wants to avoid becoming a society divided into two classes,’ he added, ‘rich landlords and poor tenants.’

Get in touch with our news team by emailing us at webnews@metro.co.uk.

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