Spain's government is moving to curb property purchases by foreigners and curb the spread of short-term rentals, part of a series of measures officials say are necessary to ease a painful housing crisis that is fast becoming one of the worst in Europe become. .
Spanish Prime Minister Pedro Sánchez said on Wednesday his government would seek a landmark 100 percent tax on property purchases by buyers outside the European Union, as part of a broader plan he announced last week to quell anger and protests in the country. cities across Spain due to a lack of affordable housing. He went even further on Sunday when he suggested an outright ban on foreign property purchases in Spain, but later backed down.
Americans have been struggling with an affordable housing crisis for years, and now Europe's major cities are grappling with a similar problem. Housing has become the largest household expenditure in the European Union, where rents have risen on average by almost 20 percent over the past decade and house prices have risen by almost 50 percent, twice as fast as the average household income.
The intensity varies by country, but they have common features, including the commodification of housing and the rise of short-term rental platforms such as Airbnb, as well as the so-called golden visa programs in Spain and neighboring countries that attracted buyers who took up the opportunity. housing in exchange for a visa.
Adding to the tension was the sharp decline in housing construction across Europe after Russia's invasion of Ukraine sent prices for building materials and energy soaring. High interest rates from the European Central Bank, aimed at curbing inflation, have battered property markets across Europe.
From Spain to Sweden, housing shortages, combined with slowly rising wages, have made access to affordable housing more difficult. The problem is so acute that Ursula von der Leyen, the president of the European Commission, recently appointed a housing czar to stimulate the search for solutions in Europe.
In Spain, Mr Sánchez warned that housing is one of Europe's biggest risks. “It is one of the most important challenges facing European societies, including Spain,” he told a conference in Madrid last week, declaring that affordable housing must become a “right” and a “pillar of the welfare state.”
“We are facing a serious problem, with enormous social and economic consequences, that requires a decisive response from society as a whole, and with public institutions at the forefront,” he added.
It is unclear whether Mr. Sánchez's proposals will become law. Included in the plan the prime minister outlined last week with twelve new measures are tax breaks for landlords that will reduce rents and proposals to build thousands of low-cost homes across Spain. Mr Sánchez said Spain has the lowest share of affordable housing of any European country, a problem that arose after previous governments allowed many homes to be sold to private investors.
Mr Sánchez said he would push for a recently created social housing company to be given priority over private investors in purchasing homes and land. Any measure would have to be passed by Spain's parliament, where Mr. Sánchez's minority party has struggled to push through bills.
But at a time when Spain is beset by crises, including efforts to recover from devastating floods, Mr Sánchez's proposals are a sign of how crucial housing is in Spain.
The urgency increases as street protests become more common.
In vacation destinations where short-term rentals have proliferated, locals have turned to tourists because of the housing shortage. In November, tens of thousands of Spaniards filled the streets of Barcelona to demand a solution. The city's mayor said it would revoke by 2028 all 10,000 permits it granted to apartment owners to convert their spaces into short-term rentals for tourists.
In Madrid, thousands have taken to the streets in recent months to demand more affordable housing, amid rising rents. “Housing is a right, not a business,” the crowd chanted.
Faced with a similar response, governments elsewhere in Europe are trying to find their own solutions. Greece announced a freeze on permits for new short-term rentals in central Athens in 2025, which has become unaffordable for many Greeks, who moved after buildings were converted in recent years to accommodate tourists.
In Germany, the construction sector faced its worst crisis in a generation when the government collapsed in December, casting doubt on the multi-billion-euro aid packages proposed by the previous government to support developers in the country, Europe's largest economy. to support. A series of leading construction and real estate companies have filed for bankruptcy, putting pressure on supply.
And in France, the government has said it wants to build 30,000 homes in priority areas, especially where factories are being built. Some cities, including Lyon and Toulouse, are building cheap apartments on top of existing buildings. The city of Paris is considering whether to convert unused office space into housing.
“The West faces a decisive challenge if it is to avoid becoming a society divided into two classes: rich landlords and poor tenants,” Mr Sánchez said in Madrid last week.
