Barcelona, Madrid, the Balearics and the Canaries: prices, foreign-buyer rules, the stalled 100% tax proposal, rent controls and tourist-licence bans.
Barcelona and Madrid are Spain's two big city markets; the Balearic and Canary Islands are its two island markets. All four attract foreign buyers, and all four are the places where housing politics is hottest: rent controls, limits on tourist flats and a proposed tax on non-EU buyers. This guide explains what is law, what is only proposed, and what to check before you buy. Figures are as of October 2026 and are indicative. Rules here change quickly, so treat every status below as something to confirm.
Prices and transfer tax at a glance
From our price guide for Spain (Idealista asking prices for used homes, 2026):
- Madrid: above €6,000 per m² for the first time, up about 6.6% in a year. Gross yield about 4.7%. Resale transfer tax (ITP) 6%.
- Barcelona: about €4,090 per m² in the first quarter of 2026 (the June figure was not confirmed), up about 7.1% in a year. Gross yield about 5.2%. ITP 10% up to €1 million, 11% up to €2 million, 13% above.
- Balearic Islands: about €5,228 per m² across the province, the most expensive in Spain. Gross yield reported near 6.7%. ITP 8% up to €400,000, 9% to €600,000, 10% to €1 million, 12% to €2 million, 13% above.
- Canary Islands: about €2,645-2,760 per m² in Las Palmas and about €2,668 in Santa Cruz de Tenerife. ITP 6.5%.
On top of ITP expect notary, registry and legal costs. Details of what is included are in the price guide, and the yield picture is in rental yield in Spain.
Rules for foreign buyers
As far as we could confirm, Spain does not forbid foreigners, EU or non-EU, from buying homes, and there is no general permit requirement for ordinary residential property. You need an NIE tax number and a bank account or payment trail. Foreigners made up about 16% of purchases in the second quarter of 2026 (summary).
The proposed 100% tax. In 2025 the prime minister announced a plan for a tax of up to 100% of the value on purchases of homes by non-EU buyers who are not resident in Spain. A bill was presented to parliament in May 2025. Reports in February and March 2026 say that it stalled because the minority government did not have the votes, that it had not been debated by March 2026, and that it had not been formally withdrawn. As far as we could confirm it is not law and we found no sign of it entering into force, but we could not verify anything after March 2026, so check the current position on the parliament website or with a Spanish lawyer before you buy. As proposed, it would not apply to EU citizens or to people with Spanish residence. It would also not matter for most of our readers who are EU residents or EU citizens, but it can matter for Russian, Belarusian, Ukrainian or other non-EU citizens living outside Spain.
Island caps. The Canary Islands government asked for measures to limit purchases by foreigners, and there were calls in the Balearics too. Reports say that Spain's parliament rejected such limits in May 2025, and the Balearic government said it opposed a ban. Treat island-specific bans on foreign buyers as not in force unless a lawyer confirms otherwise.
Rent controls
Spain's housing law of 2023 lets regions declare stressed housing markets (zonas tensionadas), where rent on new contracts is capped. Catalonia has used it: reports say that all of Barcelona is declared stressed, with new rents limited by a reference index. The Madrid regional government has said it does not apply the cap, as far as we know; confirm this. For an investor the effect is direct: in Barcelona the rent you can charge may be limited by the reference index, so use that figure, not an asking-rent portal, in your calculation. Rules and declarations can change, so verify them for the specific municipality.
Tourist-licence limits and bans
- Barcelona. The city has said it will revoke all licences for tourist apartments by November 2028, about 10,000 of them. Reports say the Constitutional Court validated the measure in March 2025. A flat bought today cannot count on tourist income beyond that date.
- Madrid. The city has tightened rules on tourist flats, as reported, with limits by area and building type. Ask the town hall's planning office, not the seller.
- Balearic Islands. New tourist-rental licences (ETV) have been under a moratorium since 2022 according to a law-firm summary, and in much of Palma and in many apartment blocks no new licence is granted. Fines for unlicensed letting are reported to run from €4,000 to €400,000.
- Canary Islands. A 2025 law is reported to limit tourist homes to about 10% of homes in a building or area (up to 20% on the "green islands"), to bar tourist use of new builds for ten years and to stop licences passing with the sale.
- Nationwide. The state-level register of short-term rentals was reported annulled by the Supreme Court in May 2026, but regions can still require their own registration. The overall picture is in short-term rental rules in Spain.
In every case the safe rule is the same: buy a property for how you will live in it or let it long-term, and treat any tourist-rental licence as a bonus that you have verified, not as a promise from the seller.
For Russian-speaking buyers and expats
Barcelona and Madrid have established Russian-speaking communities with lawyers, notaries' assistants, doctors and schools working in Russian; Mallorca and Tenerife also have sizeable ones. This helps with the process, but a few practical points apply.
- Documents. Get your NIE early (NIE and tax numbers), keep the passport and residence card for the EU country where you live, and prepare apostilled and translated documents.
- Bank and source of funds. Spanish banks and notaries ask where the money comes from. For Russian and Belarusian citizens the checks are generally stricter, so collect proof in advance: salary records, tax returns, a sale contract or a loan agreement. Read bank checks for Russian citizens living in the EU. Never try to split payments or route money through third parties to avoid checks.
- Citizenship and residence. If you are an EU resident with a non-EU passport, the proposed 100% tax would, as drafted, still concern non-EU buyers not resident in Spain; confirm how your situation would be treated. See buying property abroad with Russian citizenship and Spain golden visa for the residence side.
- Services. Use Russian-speaking communities and services by country and the overall guide for Russian-speaking expats.
FAQ
Can non-EU citizens buy property in Spain? Yes, as far as we could confirm, with an NIE number. A proposed extra tax on non-EU non-resident buyers stalled in parliament and, to our knowledge, is not law; check the current status.
Is the 100% tax on foreign buyers in force? We could not confirm that it is. It was reported as stalled in March 2026 and not withdrawn. Verify before buying.
Are rents capped in Barcelona and Madrid? Barcelona is reported as a stressed market with a reference index for new contracts; the Madrid region is reported as not applying the cap. Confirm for the specific municipality.
Can I run a tourist flat in Barcelona? Not beyond November 2028 under the announced phase-out, and new licences are not available. Plan for long-term letting.
Which is better for investment, a city or an island? Cities offer deeper long-term rental markets; islands offer lifestyle and higher prices, with the strictest tourist-letting rules. Match the choice to how you will use the property.
How we help
We are a trilingual platform that finds properties in Spain and coordinates independent local lawyers and tax advisers. We help you compare cities and islands, check licences and paperwork and prepare the documents. You can browse listings in Spain and use our calculators. This text is informational and is not legal, tax or investment advice; Spanish housing rules are changing, so verify every status with a Spanish lawyer and the official gazette at boe.es before you decide.