(Reuters) – Shares of Spanish residential real estate developers were partly recovering on Tuesday after a government plan to raise taxes on housing had prompted a selloff the day before.
Shares of Neinor Homes, Aedas Homes, Metrovacesa and Inmocemento all took a hit on Monday after Spanish Prime Minister Pedro Sanchez announced a plan to raise taxes on holiday rentals and set a tax of up to 100% on purchases of houses by non-European Union foreigners living abroad.
Housing has become a major issue in Spain as it struggles to balance promoting tourism, a key driver of its economy, with concerns over high rents due to gentrification, exacerbated by the acquisitions of second residences by wealthy foreigners, and local landlords shifting to more lucrative, short-term tourist rentals, especially in urban and coastal areas.
Neinor shares were up 4.6% on Tuesday, partly recovering from a 6.9% decline on Monday, while Aedas were up a scant 0.4% after they lost 3.3% on Monday. Metrovacesa and Inmocemento kept sliding on Tuesday morning after smaller declines on Monday.
Neinor said late on Monday that it did not expect a significant impact from the proposed measures, noting that only 2% of its 2024 pre-sales corresponded to non-resident or non-EU foreigners.
The company added that it sees housing demand as strong enough for any potential decline in the non-resident, non-EU foreigners segment to be offset by other types of buyers.
(Reporting by Joao Manuel Mauricio in Gdansk, Editing by Inti Landauro and Bernadette Baum)
