Spain's new housing law will hit British expats with tax surcharges of up to 150% on empty homes

From the Newshound archive · first published 2 October 2026.

Spain's socialist government has approved sweeping new housing legislation that could see British expats face surcharges of up to 100% on properties left empty for three years, with owners of two or more vacant homes hit with a maximum penalty of 150%. The measures were triggered by mass protests, including the eviction of 87-year-old Maricarmen Abascal from the Madrid home she had lived in for over sixty years. Spain says it needs around 750,000 additional homes to meet demand, driven by decades of sluggish construction and surging population growth.

A 50% surcharge kicks in after two years of vacancy, rising to 100% after three — with 150% reserved for those owning two or more empty properties.

Holiday-let owners in overtourism hotspots face additional council tax hikes and a 10% VAT charge under the same proposals.

Owners who sell vacant properties to public bodies for €200,000 or less could receive a full capital gains tax exemption as an incentive to release stock.