Canary Islands Send Spain a Drafted Decree Law to Limit Non-Resident Foreign Home Buying

The Canary Islands government has drafted a decree law to limit home purchases by non-resident foreigners and handed it to the Spanish government, with regional president Fernando Clavijo asking the Consejo de Ministros to approve it before the current legislature ends. Clavijo told the regional parliament on 13 October that the text exists and that his government is now lobbying the groups in the Diputación Permanente, the standing body that would have to convalidate it. No cap, quota or price threshold has been published.

What it means for a foreign buyer

Nothing has changed yet, and that is the practical point. If you are a non-resident buying in Tenerife, Gran Canaria, Lanzarote or Fuerteventura, the rules you complete under today are the rules that apply, and no transition relief exists because no instrument is in force. What has changed is the direction and the speed. A drafted decree law sitting with the national government is a different risk from a political aspiration, because a decreto ley takes effect on publication and is convalidated afterwards. If Madrid picks it up, the gap between announcement and effect could be days rather than the months a full bill would take.

The second thing to weigh is scope. The Canary amendments filed in Brussels would reach non-resident foreigners generally, not only buyers from outside the EU, and would let authorities restrict acquisition, use or rental across areas larger than a single municipality. A second home used a few weeks a year, or a short-let purchase in a pressured coastal municipality, is squarely in the target. A buyer moving to the islands as a primary resident is not. If you are mid-purchase, get the escritura signed and registered rather than leaving a long gap between private contract and completion.

Treat the buying window as open but no longer open-ended.

What changed

Clavijo confirmed on 13 October that the regional government's legal services have drafted a decree law limiting non-resident foreign home purchases, and that the text has been submitted to the Spanish government. He asked that the Consejo de Ministros approve it before the legislature finishes. No threshold, percentage cap or exempt category has been published.

The same week, the Canary government filed amendments to the draft European Regulation on housing affordability with Spain's Ministry of Foreign Affairs, EU and Cooperation, copied to the Ministries of Housing and Urban Agenda and of Territorial Policy. The amendments would allow competent housing authorities to regulate, restrict or temporarily limit the acquisition, use or rental of residential property by non-resident foreigners, over territories wider than a municipality or district and scaled to the housing emergency. They also ask that the Regulation describe such measures as short-term and complementary to supply-side policy.

Clavijo said foreign buyers account for about one third of homes sold in the Canary Islands. That is his characterisation of the market rather than a published statistic.

The mechanism

Two tracks, doing different work. The domestic track is a decreto ley, the Spanish instrument that enters force on publication in the Boletín Oficial del Estado and is ratified or rejected afterwards. The Canary Islands is a region, not the state, so it cannot enact this itself, which is why the text went to Madrid as raw material rather than being gazetted at home. The Diputación Permanente is the relevant chamber because parliament is between sessions, and Coalición Canaria, Clavijo's own party, holds no seat on it, so he is negotiating with other groups rather than voting the measure through.

The European track rests on Article 349 of the Treaty on the Functioning of the European Union, the provision that permits specific measures for the outermost regions. Housing councillor Pablo Rodríguez put it as a request that the Regulation apply Article 349 rather than a request for a privilege. That matters because free movement of capital is what blocks a member state from treating EU buyers differently, and Article 349 is the only realistic route to an exception that reaches EU nationals as well as third-country buyers. The Regulation is still in passage, so this is a years-long path, not a months-long one. Clavijo is scheduled to present the case to European Commission Executive Vice-President Raffaele Fitto in Brussels in November.

Context

Coalición Canaria supported an earlier national housing decree in exchange for a commitment to study a non-resident purchase limit. Both decrees were then rejected in Congress. The Council of Ministers approved two replacement texts without the measure, and those are the ones now heading to the Diputación Permanente, which is why Clavijo is pressing the point again from outside.

Separately, a national legislative amendment would impose tax penalties on non-EU buyers who use a property neither as a primary residence nor for long-term rental, and the Canary government is weighing use restrictions and higher IBI council tax on vacant homes. Spain's much-reported 100 percent levy on non-EU buyers has still not become law. On the supply side, Clavijo cited roughly 200,000 empty homes in the islands on INE estimates, 57 percent of them in municipalities under 50,000 inhabitants, against 4,000 public homes under construction and some 7,500 private housing permits expected by the end of 2026.

For the national framework these measures sit inside, see our coverage of Spain re-enacting its housing decrees and extending the fund purchase ban to 2030, the 10 percent VAT on tourist lets and the 2 percent rent cap, and the current status of Spain's proposed 100 percent tax on non-EU property buyers.