Why having an empty home in Spain could soon cost you more
In order to help solve the housing crisis, Spain's Socialist-led government recently presented a draft bill in Congress with several eye-catching tax proposals.
One of these fiscal measures was aimed at encouraging the release of empty properties into the rental market by progressively increasing the amount of taxes owners are charged.
There is no updated official registry of vacant properties in Spain, but according to the National Statistics Institute (INE) census in 2021, there are 3.8 million of them, which is 14 percent of the total.
According to the INE, a home is considered empty when "It is not the habitual residence of any person nor is it used seasonally, periodically, or sporadically by anyone." Therefore, it is considered "uninhabited'.
The current legislation defines empty properties as those that have been vacant for longer than two years.
The government has confirmed that it does not include second homes that are used for holidays once or twice a year, for example.
Spain's main stats body estimates the number of empty homes by looking at which ones do not meet minimum electricity consumption.
The idea of the new measure is to make those with empty homes pay more. To do this the government will modify personal income tax or IRPF. Currently, homeowners are charged 1.1 percent of the cadastral value or 2 percent if this value hasn't been updated in more than a decade.
If the new bill passes, those with vacant homes with a total cadastral value of up to €100,000 will continue to add 1.1 percent to their tax return, but beyond that, the percentage will increase to 1.5 percent up to half a million euros; to 2 percent for homes worth up to €1 million; and up to 3 percent for those with empty homes valued above €1 million.
Here's an example of how this would work in reality. The average price of a property in Spain is around €165,000. So, under the current rules, a homeowner who keeps it empty will have to add €1,815 to the amount used to calculate their personal income tax. With the government's new proposal, this would rise to €2,475.
If it's a very wealthy person with three homes with the same cadastral value - €495,000 in total - the tax would go from €5,445 to almost double that amount - €9,900.
With this new measure, the government hopes it will put thousands of vacant homes back on either the rental market or up for sale.
A total 26.1 percent of homes in towns with fewer than 1,000 inhabitants in the region of Madrid are considered to be empty, and in Catalonia it's 24.8 percent.
The general pattern is that the percentage of empty homes decreases as the population grows.
In Madrid, only 5.6 percent of properties in municipalities of more than 100,000 inhabitants are uninhabited, while in Catalonia, 8.4 percent of towns with more than 48,000 are uninhabited, according to Ministry data.
In big cities like Madrid, Barcelona, and Málaga less than 10 percent of properties are empty.
Not everyone thinks the Spanish government's fiscal punishment will work though. Jaime Palomera, co-founder of the Urban Research Institute and the Sindicat de Llogateres (Landlords ' Union) explained to newspaper El Diario that 'the monetary impact in terms of costs is too small to incentivise owners'.
He also explains that the cadastral value is usually much lower than the tax and appraisal values. This means that a property costing €600,000 home can easily have a cadastral value of €200,000. This could be an issue because owners will be paying much less tax for what the property is actually worth.
Víctor Palomo, a lawyer from the Spanish Housing Authority (CAES) also believes this measure is not enough. "For it to be effective, the surcharge has to be striking'.
Spain's maligned Housing Law, introduced two years ago, already included the possibility for city councils to add up to 150 percent of the property tax for empty homes.
Some municipalities in the Basque Country and Catalonia already implemented this, but so far experts claim there no evidence that this has put very many of them back on the rental market.
It's important to remember that far this is a draft law, which means it will still have to pass through Congress and receive a majority vote, not so straightforward for the ruling Socialists given their weakened parliamentary position.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Local Spain
5 hours ago
- Local Spain
Leire Díez: The latest chapter in the corruption saga affecting Spain's PM
Politics A former member of Spanish Prime Minister Pedro Sánchez's Socialist party on Wednesday denied waging a smear campaign against a police unit investigating corruption accusations targeting members of his inner circle. Leire Díez has come under scrutiny after leaked audio records surfaced of her talks with a police commander and a businessman implicated in corruption probes. In the recordings, she appears to offer judicial leniency to both in exchange for potentially compromising information on top members of the Guardia Civil police force's anti-corruption unit. This unit is investigating graft allegations levelled against Sánchez's wife, brother and his former right-hand man, prompting allegations that she may have been trying to interfere with these probes. But Díez attempted to quash the growing scandal, telling reporters on Wednesday that she was conducting research for a book and was not working on behalf of the party or Sánchez. "I am not a woman in the shadows. I have been doing investigative work for years," she said a day after she resigned from the party. She also lashed out at what she called "calculated and fabricated leaks". Tensions flared at the press conference when businessman Victor de Aldama, a central figure in one of the corruption cases troubling Sánchez's administration, unexpectedly attempted to confront Díez. "She lies and mocks everyone," he shouted. The main opposition Popular Party (PP) has called for a protest in Madrid on Sunday against the government over the affair, accusing it of "mafia practices". The PP, as well as far-left party Podemos and Catalan pro-independence party ERC, have demanded that the prime minister appear in parliament to give explanations over the case. Sánchez has dismissed the probes affecting members of his inner circle as part of a "smear campaign" carried out by the right wing to undermine his government.
Local Spain
10 hours ago
- Local Spain
Spain to spend €39 million on metal health to help suffering workforce
Health The Spanish government has approved new funding for mental healthcare as new data shows that mental health leave among the country's workforce has spiralled by 175 percent since the pandemic, costing taxpayers €15 billion a year. The Spanish cabinet on Tuesday announced that it would spend €39 million in order to strengthen mental healthcare treatment availability in public hospitals. It also approved another €17.83 million for the implementation of suicide prevention measures, in line with Spain's Mental Health Action Plan 2025-2027 and the Suicide Prevention Plan 2025-2027. Mental health cover is one of the biggest gaps in the public health system in Spain and it seems though people are suffering because of this. According to the latest data from the 2023 National Health System Annual Report, 34 percent of the Spanish population has some form of mental health issue. According to the Ministry of Health, the most common mental health problem is anxiety which affects 6.7 percent of the population with public health cover. Depression is seen in 4.1 percent of the population and increases with age, while sleep disorders affect 5.4 percent of the population and also increases with age. Psychoses overall affects 1.2 percent, while dementia is recorded in 3.2 percent of the population aged 60 and over. The number of workers on sick leave has continued to rise since the pandemic and particularly mental health leave has risen by 175 percent. The cost for the health authorities has continued to skyrocket. Public spending as a result of these absences amounts to around €15 billion per year and has increased by almost 80 percent since the pandemic, while the direct impact on businesses has grown by 62 percent, to €4.6 billion. Particularly worrying is the incidence among young people, which has doubled in recent years. Spaniards are also the world's biggest consumers of anti-anxiety medication and the EU's largest consumers of psychiatric or psychotropic medication, which includes antidepressants, anti-anxiety medications, stimulants, antipsychotics, and mood stabilisers. According to the latest r eport from the Bank of Spain, 4.4 percent of workers are currently on sick leave and in 2019 it was only 2.7 percent. In total, more than 1.5 million people are on temporary disability. This is equivalent to half of the public administration. Patricia Ruiz, Secretary of Occupational Health for Spanish trade union UGT explains that, 'Stress, depression, anxiety' are the worst culprits. According to the data, incidence among those under 35 is striking. 'Mental health issues have increased by 325 percent in young people' she warns. The UGT have criticised the system saying "There's no follow-up, no attention to their ailments. It's just like they're waiting to go through a formality'. Long waiting lists in public healthcare have also made the situation worse. Yolanda Díaz, Minister of Labour, acknowledges that waiting lists are very long. "It also has to do with mental health. We live in stressed societies', and we have "aging" labour markets she explains. The hope is that by spending money on increasing health programmes and the medical professionals to deal with these issues, less people will suffer and need to go on leave from work. See Also
Local Spain
10 hours ago
- Local Spain
Why are Spain's new self-employed workers all foreign and what are their jobs?
A whopping total of 96.5 percent of new autónomos in Spain who registered over the past four years were foreign nationals, according to the National Federation of Self-Employed Workers (ATA). From March 2021 to the same month in 2025, 108,155 new self-employed workers have signed up to the Special Regime for Self-Employed Workers (RETA) - out of these 104,338 have been foreign entrepreneurs. "The data is overwhelming: the foreign self-employed community has become a fundamental pillar of RETA's growth over the last four years . This isn't just a statistic; it's a reality that demonstrates the vitality and dynamism they bring to the Spanish productive fabric," explained the president of ATA Lorenzo Amor. In fact, the numbers of foreign autónomos (self employed) almost doubled in number over the past 10 years, having increased by 92 percent since 2015. The number of foreign self-employed workers increased in all 17 regions with the exception of Ceuta and Melilla, which both lost contributors to the system. The regions with the largest number of foreign self-employed workers since 2021 are Valencia with 22,391 foreign self-employed workers, Catalonia with 21,046 and Andalusia with 15,509, which makes sense as these are also the regions that are most popular with foreign residents, along with Madrid. At the same time, there has been a decrease in the number of Spanish autónomos over the last five years in nine regions: Aragón, Asturias, Cantabria, Castilla y León, Castilla-La Mancha, Galicia, Navarra, the Basque Country and La Rioja. Since the numbers of foreigners have increased, however, the total overall signed up has risen. The growth in the number of foreign self-employed workers has been greater than that of Spanish nationals in most regions, with the exception of Andalusia, the Canary Islands and Madrid where the growth of self-employed workers of Spanish orgiin is greater than that of foreigners. ATA revealed that the number of foreign self-employed workers has grown over the past four years, particularly in the construction sector (+17,446 foreign self-employed workers), professional, scientific, and technical fields (+13,906 self-employed workers), hospitality (+12,670), and information and communication (+11,115). The professional, scientific and technical fields include autónomos in accounting, architecture and engineering, technical testing and analysis, consulting, research, social sciences and humanities, advertising, public relations and communications, photography, veterinary medicine, design, translation, interpretation and market research. "It is foreign self-employed workers who are helping to offset the declines in traditional sectors such as commerce and agriculture and who are driving growth in activities such as construction, hospitality, and professional services," explained the president of ATA. The Spanish authorities have been open about the pivotal role foreign self-employed workers are playing in Spain. They are needed in a country with an ageing population and in place that are suffering from depopulation. 'Foreign entrepreneurship is a fundamental pillar of our country's economy,' Spain's Union of Professionals and Self-Employed Workers (UPTA) President Eduardo Abad has said, with his organisation estimating that Spain will need another 200,000 more foreign autónomos in the next five years. So why the steep increase in foreign entrepreneurs and decrease in Spanish ones? There are several reasons behind the shift in numbers. Firstly, there's the fact that Spain's population is increasing (now 49.1 million) and that's also almost entirely due to the arrival of more foreigners, rather than more Spanish babies being born. Inevitably, a bigger migrant population in part accounts for the higher number of foreign autónomos. Another of the most significant reasons is the introduction of the Digital Nomad Visa (DNV) at the beginning of 2023. This has enabled remote workers or those that worked for themselves for clients abroad to gain residency in Spain and has proved very popular with non-EU citizens, particularly with those from the US and the UK. It has also been popular with those from countries who can apply for Spanish citizenship after only two years of residency such as those from the Philippines and Latin America. In order to be eligible, foreign self-employed workers have to promise to sign up to the autónomo system. Another reason is the fact that it's often it's easier for foreigners to start their own businesses than to rely on the local job market. With high levels of unemployment, relatively low salaries compared and language requirements, getting a job here as a foreigner can be challenging. For many, it's actually easier to try and work with clients back in their home countries or start businesses aimed at other foreigners. Thirdly, many foreigners believe it's a good way to be able to live in Spain, but underestimate how tough it is to actually be self-employed here and so sign up without actually knowing how it all works. In fact, the 'dream' for many Spanish workers is to become a civil servant, and a great deal of those who've reached this conclusion are former autónomos. Self-employment tax rules and regulations in Spain can be extremely difficult to get your head around, and what's more you are required to pay one of the highest amounts of social security in Europe. To put things into perspective, if you're earning enough to be eligible for the DNV (€2,763 per month), you'll be paying €440 in social security each month. And this isn't even tax – the tax is paid separately on top of this. You'll also likely have to pay a gestor or accountant to do your taxes as they're so complicated here – forcing you to fork out an average of another €50 per month. Around €500 per month straight off the bat before you even earn anything can be very prohibitive for many to even start a business. Being self-employed here also means stricter rules when it comes to how you invoice, how you get paid and what you can offset against your taxes. It may not be the same as back in your home country. The drop in the number of Spanish self-employed workers could also be explained by the fact that they're aware of how difficult the system is and don't want to take on that burden. They may be happier simply being an employee without the extra stress. In fact this can be evidenced by the fact that only three out of ten (29.7 percent) of Spaniards would recommend self-employment to others, according to a survey by Emprendedores entrepreneurs website. Despite the high payments and strict rules, however, being self-employed and paying social security Spain does enable you to get public health care, paternity and maternity pay and in some cases sick pay too. It's also one of the easiest ways to be able to move to Spain if you're from a non-EU country and many foreigners many to make it work. If you know what you're getting into, read up on all the rules and are aware of how much you'll have to pay out it could be a great option if you have your heat set on living in Spain.
