Spain Introduces Sweeping Changes to Tackle Housing Crisis and Overtourism

In a bid to address the escalating housing crisis and the impacts of overtourism, the Spanish government has announced a series of stringent measures targeting the short-term rental market, particularly platforms like Airbnb.

Tax Hikes on Holiday Rentals

Spanish Prime Minister Pedro Sanchez has unveiled plans to increase taxes on holiday rentals, aiming to align them with business tax rates. This move is part of a broader strategy to combat the housing shortages and soaring rents that have become pervasive across the country. Sanchez emphasized that it is unfair for short-term rental owners to pay less tax than hotels or workers, highlighting the need for a more equitable tax system[1].

New Regulations and Database Requirements

As of January 2, 2025, property owners in Spain are required to register their properties in a national database and obtain a permit before listing them on booking platforms. This regulation also mandates the collection of sensitive personal information from guests, including bank details and personal identifiers. The full enforcement of these regulations will commence on July 1, 2025, with non-compliant property owners facing fines of up to €600,000[2].

Crackdown on Non-EU Property Buyers

In an effort to curb the speculative buying of properties by non-EU citizens, the Spanish government has proposed a tax of up to 100% on property purchases by these buyers. This measure is designed to prioritize housing for residents over tourist use. In 2023, non-EU residents purchased approximately 27,000 properties in Spain, primarily for rental purposes rather than residency. This new tax aims to deter such purchases and make it financially unviable for many foreign buyers[3][4].

Municipal-Level Restrictions

Several Spanish cities have already implemented or announced plans to restrict or ban short-term rentals. For instance, Malaga's city council has prohibited short-term rental registrations in 43 neighborhoods, while Barcelona aims to eliminate all short-term rentals by 2029. Alicante has approved a two-year ban on new licenses for short-term rentals. These local measures reflect the growing concern over the impact of short-term rentals on housing availability and affordability[1][4].

Impact on Rural Communities and Local Economy

Airbnb and other rental platforms have expressed concerns that these new regulations could have severe repercussions for rural communities and small businesses. According to an Oxford Economics report, short-term rentals in Spain generated €29.6 billion for the economy in 2023 through guest spending in local shops, restaurants, and businesses. The report also highlights that 70% of Airbnb bookings are for properties in rural or low-density urban areas, contributing significantly to local economies[2].

Anti-Tourism Protests and Housing Shortages

The measures come amidst rising anti-tourism protests across Spain, particularly in popular tourist destinations. Residents have been vocal about the negative impacts of overtourism, including inflated housing prices and reduced availability. Despite these protests, Spain saw a 10% increase in visitors in 2024, with 94 million foreign tourists visiting the country[2][4].

Future Outlook and Challenges

The implementation of these new regulations and taxes faces significant challenges, including the need for a majority vote in Spain's divided Parliament. Additionally, there is a lack of standardization in the application of these rules at municipal, regional, and national levels, causing confusion among property owners and potential landlords. As Spain navigates these changes, it remains to be seen how effectively they will address the housing crisis and the issues associated with overtourism[2][3].

For expats in Spain, these changes signal a significant shift in the country's approach to housing and tourism. While the measures aim to protect residents and address pressing social issues, they also introduce new complexities and uncertainties for those involved in the short-term rental market. As the situation evolves, it will be crucial for expats and property owners to stay informed and adapt to the changing regulatory landscape.