Political party in Valencia wants to ban property sales to foreigners

5/4/23, 11:01 AM By Costas News Costa Blanca

A political party in Valencia have announced that they want the Spanish Government to ban foreigners from buying properties in Spain, as it is driving up prices and taking homes off the residential market to rent out as holiday homes, making it more difficult for residents to buy or rent one.

Compromís have suggested that there is an amendment to the new Housing Law and proposes that the sale of properties to foreigners or companies be blocked for three years to stabilise the market.

They claim that this has worked in other countries, using Canada as an example, who has banned some foreigners from buying residential properties as investments for two years.

However, Compromís’s proposal has some exceptions, such as foreigners who’ve had a work permit in Spain for at least three years, and citizens with temporary resident status valid for at least five months before. Foreign companies focused on developing social housing would also be exempt.

They believe that the country needs to be aware of hedge funds, private-equity companies, and vulture companies who have bought large amounts of properties in mainland Spain, the Balearic Islands, and the Canary Islands, which has created a false market.

This isn’t the first time banning the sale of properties to foreigners has been on the political agenda to help combat the country’s housing problems, both the aforementioned Balearic and Canary Islands have requested the same thing within the last year, however, it was ruled against as it was seen as going against the EU’s rules on the free movement of people and capital, which applies to non-EU citizens as well.

This means to implement a ban, they would have to prove that foreign property purchases are blocking Spaniards from their fundamental right to housing which is in the Spanish Constitution, further complicating the introduction of a legal amendment.