According to new research from 1st Move International, Euro News reports these potential tax changes could have a significant impact on the European property market, particularly for British buyers who frequently invest in second homes abroad.
Spain, Portugal, France, and Germany were among the top relocation destinations for UK buyers in 2024, but rising taxes and restrictions may push them to consider alternative markets.
Spain is also ending its Golden Visa programme on 3 April 2025, a move designed to curb real estate speculation by foreign investors. Similar policies are being explored in Greece, Portugal, and France, where authorities are cracking down on short-term rentals and promoting sustainable tourism to combat housing shortages.
Despite the intent to free up housing for locals, these policies could have unintended economic consequences. Tourism and foreign investment are major contributors to GDP in these countries – France’s tourism industry accounted for 9% of GDP in 2023, generating €66.4 billion, while Portugal’s tourism revenue hit €25.1 billion the same year.
A heavy property tax on international buyers could slow investment and dampen real estate markets.
With the uncertainty surrounding European property taxes, many British buyers are looking further afield, with the US, Australia, UAE, Canada, and New Zealand ranking as top destinations.
Cyprus, in particular, is becoming increasingly attractive, thanks to its Mediterranean climate, expat-friendly tax policies, and affordable living costs.
While governments attempt to balance housing affordability and economic growth, these evolving tax policies could reshape the international property landscape for years to come.
