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PROPERTY

What are Spain’s plans to charge owners of empty homes more tax?

When approved, Spain’s new housing law is likely to see some property owners being charged extra for keeping their homes empty. But will the average foreign second homeowner in Spain be affected?

Published: 2 March 2023 09:33 CET
What are Spain's plans to charge owners of empty homes more tax?
Spain to fine landlords who keep properties empty. Photo: Federico PARRA / AFP

After months of negotiations, Spain’s housing law or Ley de Vivienda is likely to be approved sometime within the next few months, bringing about several changes to help vulnerable people, such as the young or those with low incomes to access housing.

The law includes several points such as freezing rental prices in certain areas and prohibiting the free sale of Officially Protected Housing.

READ ALSO – EXPLAINED: Six things to know about Spain’s new housing law

One point that has caught the attention of foreign property owners is the increase in Property Tax (IBI) for homes that remain empty.

In a bid to tackle Spain’s social housing shortage and fill some of the reported 3 million empty homes in Spain, local councils will have the power to implement a surcharge of up to 150 percent on the Property Tax (IBI) quota under the new legislation.

READ ALSO: How to pay less of Spain’s IBI property tax

Does this mean it will affect foreigners with second homes in Spain who only use them during certain times of the year?

The answer is no, the surcharge will only be levied on homes that have been empty for more than two years without good reason, as well as for property owners with a minimum of four homes in the same municipality.

If the property has been empty for three years, the surcharge could reach 100 percent, and there could also be an additional 50 percent rise in the case of properties whose owners have two or more flats in the same municipality.

The idea is that more landlords will start renting out their empty homes to avoid the extra charges, creating more properties for rent on the market and hopefully reducing the prices.

The amount you could pay will depend on each different ayuntamiento or town hall.

IBI is a local tax which has to be paid once a year by all property owners in Spain, and it serves as a benchmark to calculate all other Spanish property-related taxes.

According to data from the General Council of Economists, in Spain the average amount of the IBI bill is €315 per year.

With this extra surcharge however, the average would rise to €788 for each empty property.

Here are some of the prices that owners of empty properties could pay in various major cities:  

Madrid: Owners would go from paying €438 on average to €1,095.

Barcelona: Owners would go from paying €397 on average to €992.

Valencia: Owners would go from paying €290 on average to €435.

Seville: Owners would go from paying €262 on average to €655.

Málaga: Owners would go from paying €244 on average to €610. 

While this law has been implemented on a national level, several regions have also tried to implement their own laws on empty housing.

From early 2023, the Valencian government has introduced an extra tax on empty homes for landlords that own more than 10 properties. This will affect properties that are not up for sale or rent and have been empty for six months or more. In this case, they will have to pay monthly fines.

Forecasts from the Ministry of Housing estimate that throughout 2023 a total of €250,000 will be collected in fines if the homes are not put on the market within a period of six months. 

Back in 2021, the Basque Country also contemplated a similar plan to introduce economic sanctions on empty properties in the region. The mere threat of these fines, however, has seen the number of empty properties in the Basque Country fall by 25 percent.  

The most recent data for 2022 shows that 11,434 apartments have remained empty continuously for at least two years. This is 3,666 less than in the previous count from 2019.

But it’s not just regions implementing these rules, some town halls are doing so too.

In late 2022, the Tarragona City Council in Catalonia also opened disciplinary proceedings for the first time against owners of apartments that are always empty. Specifically, 487 files have been filed so far against landlords of “permanently” unoccupied homes. Sanctions are due to be imposed. 

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PROPERTY

Too hot or too cold: Spain’s homes struggle to keep comfortable temperatures

Amid rising temperatures and more extreme weather, new data reveals that a significant proportion of Spaniards are struggling to keep their homes at comfortable temperatures during the winter and summer months.

Published: 14 May 2024 09:51 CEST
Too hot or too cold: Spain's homes struggle to keep comfortable temperatures

Spaniards are increasingly finding it difficult to keep their houses at comfortable temperatures during the summers and winters, and the problem has grown markedly over the last decade.

This follows new data released from Living Conditions Survey recently published by Spain’s National Statistics Institute (INE), which revealed that over a quarter of families in Spain struggle to heat their homes sufficiently in winter and that a third are too hot in summer.

The percentage of households reporting difficulties in keeping their homes at a comfortable temperature has increased by almost ten percent overall in the last decade.

READ ALSO: Why are Spanish homes so cold?

In the colder months, the proportion that say they can’t keep their property sufficiently warm during winter has grown from 17.9 percent in 2012 to 27.5 percent in 2023.

The summer heat poses an even greater problem for Spaniards. The percentage of households struggling to keep their homes cool enough during the summer months has risen from a quarter (24.8 percent) to over a third (33.6).

READ ALSO: Ten ways to protect your Spanish property against the summer heat

This comes as Spain faces record breaking temperatures year round and rising energy costs. According to Spain’s State Meteorological Agency (Aemet), 2023 was the third hottest summer since records began, surpassed only by 2022 and 2003.

In summer 2023 alone, four official heat waves were recorded, lasting a total of 24 days.

READ ALSO: How the right orientation of your Spanish home can save you hundreds on energy bills

However, though rising temperatures clearly play a role, so too does geography, income, and poor energy efficiency caused by poor insulation.

Murcia is the region where the highest proportion of households have problems keeping their homes cool in the summer, with almost half of families polled saying they are in this situation (46.6 percent). Murcia was followed by Madrid, Andalusia, Catalonia, Aragón and Extremadura, where the figure is 36 percent.

At the other extreme, in the cooler, northern regions of Asturias, Cantabria and Galicia, it is not even 20 percent.

Despite that, it is also the southern regions that struggle the most with keeping their houses warm enough during the winter. Murcia is once again the region where the highest percentage of families are unable to keep their homes at an adequate temperature over the colder months.

40.1 percent of Murcianos say they find it difficult to heat their homes over winter. In Andalusia and Extremadura the figure is almost 35 percent, the other two regions that top the list, meaning the three most southern regions of Spain came out on top.

In contrast, in Navarre, Castilla y León​​, and the Basque Country, less than a fifth (20 percent) of households report problems maintaining a sufficiently warm temperature at home during winter.

Household income also factors into this problem. INE data shows that the proportion of households struggling to maintain an adequate temperature in their homes increases as average income decreases. Among families with the lowest income levels, 38.9 percent say that they are cold in winter and 41.3 percent say that they are too hot in summer.

Of the regions that struggle to keep their homes warm or cool enough, Murcia, Andalusia and Extremadura all have some of the lowest median per capita incomes in the whole country, along with some of the highest levels of poverty.

Equally, the parts of the country where this seems to be less of a problem, such as the Basque Country, Galicia, and Navarre, are some of the wealthiest regions of Spain.

Housing quality and insulation also contribute to poor energy efficiency, which in turn makes temperature control more difficult. Even among households with high incomes, 15 percent say that they are unable to heat their property sufficiently in winter and 24.8 percent struggle to keep it cool enough in summer.

According to INE data, a quarter (25.1 percent) of Spanish households have not made any improvements to their thermal insulation or heating system in the last year, significantly more than the 14.1 percent who have been able to make changes.

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