Movement challenges Government to follow Spain’s lead on housing crisis

Spain has announced plans to impose a tax of up to 100% on real estate bought by non-residents from countries outside the EU, in an aim to tackle the country’s housing crisis.

Photo by Zdenek Klein on Unsplash

The Portuguese movement Porta a Porta has urged the national government to adopt measures similar to those recently announced by Spain in addressing the housing crisis.

On Monday, Spain’s Prime Minister, Pedro Sánchez, revealed an ambitious plan on Monday, including a 100% tax on property purchases by non-European Union foreign residents, aimed at curbing speculation and skyrocketing property prices.

The measures are part of a broader package of 12 initiatives to combat housing affordability issues.

These include tax benefits for landlords to increase rental housing availability and stricter regulations on short-term rentals.

Sánchez emphasized the need for state intervention to mitigate the housing crisis, contrasting Spain’s approach with previous neoliberal policies he blamed for exacerbating the problem.

Calls for Action in Portugal

André Escoval, spokesperson for Porta a Porta, called for Portugal to adopt similar measures, arguing that relying solely on market dynamics has worsened the housing situation.

“The data already shows a severe acceleration of housing problems in our country,” Escoval said, praising Spain’s “positive” approach and advocating for Portugal to follow suit.

However, Carlos Luís Teixeira, representing the National Association of Property Owners in Portugal, pointed out key differences in the economic and social realities of the two countries.

While supporting the idea of drawing inspiration from Spain’s policies, he stressed that Portugal’s main challenge lies in the implementation of housing solutions, including modernizing the construction sector and providing public guarantees for property transactions.

Teixeira also suggested that Portugal adopt programs like the rehabilitation of vacant homes, an initiative currently underway in Spain.

Spain’s New Housing Measures

The Spanish Government’s new housing plan include expanding the supply of social housing, offering incentives to those who renovate and rent out empty properties at affordable prices and cracking down on seasonal rentals.

In Spain just 2.5% of housing is set aside for social housing, a figure that lags drastically behind countries such as France and the Netherlands, but higher than Portugal (which is around 2%).

Spain has long been a popular destination for non-EU holiday home buyers, with residents of the UK, US and Morocco flocking to buy properties in places such as Ibiza, Marbella and Barcelona.

Sánchez described the tax of up to 100% as “unprecedented” in Spanish history.

“Just to give an idea, in 2023 alone non-European Union residents bought around 27,000 houses and flats in Spain. And they didn’t do it to live in them, they didn’t do it for their families to have a place to live, they did it to speculate, to make money from them, which we – in the context of shortage that we are in – obviously cannot allow.”

He did not offer more details on how the plan would work or when it would be finalised and sent to parliament for approval.

The Government’s slate of measures also took aim at short-term rental flats, which have long been blamed for shrinking the rental supply and leaving locals priced out of the market.

Sánchez said regulations on these rentals would be tightened while the taxes they pay would be hiked. “It is not fair that those who own three, four, five apartments for short-term rental pay less tax than hotels,” said Sánchez.

“Tourist properties must be taxed as businesses,” Sánchez declared, underscoring the need to prioritize residential needs over speculative investments.

The Spanish Government has also created a fund to strengthen local enforcement against short-term rental violations.