There is always someone who feels worse off. If it's not the foreigners, it will be the Spanish who go to work abroad and come back with substantial savings who push up prices etc.
Those who have enough cash will still buy the villa with sea views and while it might not cost 1 million, the 800K will also be out of reach for the normal worker.

Rather than increase transfer tax on new sales of second homes, could the problem be solved more easily by increasing the notional value of second homes (existing and new) by a factor of 10 or more which would make the imputed rental income tax punitive and the only exception would be if the property was rented on a long term contract to the people who are desperate to find affordable homes in which case the tax rate would be zero. This would apply to all second homes irrespective of of residency or nationality status. This would result in many sales which could be compensated for by zero CGT. on these sales.

Obviously I'm not in a position to comment on the situation in Spain but acknowledge some of the insights given above, particularly in respect of the plight of many Spanish.

However, as an immigrant myself, I bought a property here, luckily just at the start of the property boom, which resulted from some specific government policies. So, in a very small way I fuelled that boom - but, my purchase (including a considerable amount spent on furnishings plus the payment of stamp duty) brought in new money, foreign currency, which every Country needs. And then, of course, there is the income brought in over the last 10 years, again new money, foreign currency - which the Country needs.

But you live there - this new proposal will not affect any foreigner who actually resides in Spain. It would be levied on people who do not live in Spain but buy property here either as holiday homes or to rent out short term to tourists (some people do both, of course, rent out for the periods they are not using the property themselves).

Ah, I misunderstood, I thought that it would apply to any third country national buying a property, including for permanent residential use. My mistake!

No one would dispute the added value to the Spanish economy of the sales of new homes and all the taxes and local expenditure that goes with it, but times have changed and there are no longer enough houses/apartments available to the local Spanish population. The government should have seen these long-term problems building up, but when did any elected government take a long-term view? Just look at the housing situation in the UK. However, Spain is very different from the UK in that it has hundreds of thousands of "second" homes built over the last 20 years or so, to the detriment of building low-cost affordable houses for Spanish families.

Something has to be done in the short term; if not, there will be more riots on the street. Sadly, as the UK labour government is now realising, trying to build houses cannot happen quickly. Spain, however, has a load of second homes that, by imposing punitive measures, can potentially be freed up for the families who need somewhere to actually live, rather than families (whether Spanish or not) using them for a few weeks of the year to lie in the sun, or mainly let them at crazy prices for a few weeks at a time to other sun worshippers.

I wouldn't say that Spain doesn't have enough houses and recently they were complaining about empty properties everywhere. The poor still won't be able to afford these homes as they will be bought up by wealthy EU nationals.

I really wish people would stop talking as if this proposal to impose much higher taxes on non resident, non EU property purchasers was the only measure the Sánchez Government is proposing to help alleviate the housing crisis. What about the measures designed to allow more social housing for affordable rents to be built, ensuring that properties built using public funds stay in public ownership, raising taxes on rental income received from short term tourist letting, giving income tax exemptions to landlords who are prepared to rent long term and restrict rent increases to the Official Price Index, etc?

In our urbanisation, a mixture of apartments, attached and detached properties the recent purchasers have all been north European nationals who then spend more money on reforms. The sale price before the reform would be a challenge if not impossible for most Spanish families looking for a property to live in. So I don’t see the ‘proposed’ property tax changes being of immediate benefit as the market is unlikely to reduce given the spending power of some EU nationals.

In reality Expats are probably not interested in the other proposals. On paper everything looks great but you need the manpower to build and what type of homes are being built as the wrong type of home can also create the opposite. When you build thousands of tiny apartments, the demand for larger apartments will increase. It can also go the other way and you see it in other countries when some get fancy houses and the middle class feel left behind. They never seem to learn either and more concrete can cause flooding etc.
No easy fix and some solutions can cause other problems.

Quite right Lynn, they are all good proposals which are needed, but this thread has concentrated on the tax on second homes issue, which is highly contentious, which is why the majority of posts are focussing on it.

Exactly and we have an ageing population in Europe with more and more pensioners entering the market. If it's not the Chinese or UK buyer it will be a Swedish or German buyer.

With headlines like this in the British media, who could blame you?

BBC: Spain plans 100% tax for homes bought by non-EU residents

The UK should tax all Spanish nationals 500% on rents and purchases going forward

If you read the headline it's clearly wrong.