Sánchez made the announcement as he unveiled a series of measures aimed at solving the problem of spiralling property prices and rents in Spain.
"We have decided that we are going to limit the purchase of properties by non-EU foreigners from outside the EU," the Socialist leader told the Spanish Congress.
Although more details are yet to emerge about how Spain’s left-wing coalition government would limit them, it appears to be rather a case of dissuading third-country buyers by taxing them more.
Q&A: How and why does Spain want to stop foreigners from buying property?
"For them, the tax burden will be up to 100 percent of the value of the property," the Spanish Prime Minister said.
It is unclear at this point what this extra fiscal burden will entail, whether property transfer tax, VAT, capital gains or other. But there is the sense that the objective is to make it less financially viable - and/or profitable - for non-resident non-EU nationals such as Brits and Americans to buy a second home in Spain.
"In 2023 alone, non-EU non-residents bought 27,000 houses and flats", Spain’s PM argued.
“Not to live in them, they did it mainly to speculate. To make money from them. Something that we cannot afford in the context of scarcity we are experiencing".
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The idea of limiting third-country nationals who don't actually reside in Spain from buying second homes has previously been suggested in regions such as the Canary Islands and the Balearics, where foreigners have bought a high proportion of properties and there is limited space and stock.
According to Idealista, Spain's main property website, EU legislation makes a total ban on property purchases almost impossible.
The prohibition of all restrictions on the movement of capital between Member States and third countries, which includes the purchase of real estate, means that any EU citizen essentially has the right to purchase property in any member state without significant restrictions.
Denmark, Malta and the Aland Islands in Finland all have restrictions on how non-resident foreigners can buy properties in their territories. However, they introduced these before entering the EU and these limits were factored in and accepted by Brussels.
The news comes after Spain's government also decided to scrap its golden visa scheme - due to come into effect in April - which for the past decade has allowed non-EU nationals who bought a Spanish home worth at least €500,000 to easily gain Spanish residency.
In 2022, foreigners with a second home in Spain contributed €6.35 billion to Spain's GDP and generated more than 105,000 jobs in the tourism sector, according to the study "The economic impact of residential tourism in Spain" done for the Spanish Association of Developers and Builders (APCE) by PricewaterhouseCoopers (PwC).
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