Parliament approved an amended motion regarding non-resident home-buying. | Pilar Pellicer


While the Balearic parliament was debating prohibition of home buying by non-residents on Tuesday, the chief economist for Spain at BBVA Research, Miguel Cardoso, was being asked his opinion.

At a press conference in Palma at which the bank reported that the Balearic economy grew by 10.7% in 2022, double that of Spain's growth and thanks to the strength of tourism, Cardoso offered an alternative to any ban. Noting that the Unidas Podemos motion for prohibition would in any event run into legal barriers, he suggested that increasing taxes on second homes would be a "better solution" for creating affordable housing.

Referring specifically to the IBI property tax (or council tax), Cardoso said that applying this sort of tax increase to a "boom" in second homes would generate financial resources with which the government could fund affordable housing.

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He indicated that this tax might also discourage an "accumulation of assets", but that revenue could nevertheless be used for affordable housing, meaning that citizens would be helped "in a greater way without getting into this type of legal problem".

Back to its main theme, that of economic growth, the bank forecast 3.1% this year and 3.2% in 2024, leading to 39,000 new jobs over two years and a reduction in unemployment of seven to eight per cent in 2024.

In parliament, the Unidas Podemos motion was in the end supported by PSOE but with amendment. The spokesperson for the senior party in the government coalition, Pilar Costa, said that the proposal as it stood would "mislead the public" into believing that the government could legislate in favour of a ban, which is not the case. The final wording was that "parliament urges the Balearic government, in coordination with the Spanish government and European institutions, to promote a law that contemplates the necessary measures to restrict the purchase of homes by non-residents in order to avoid current housing speculation".