Spanish Senate has approved the new Capital Gains Tax law for non-residents to be reduced from 35% to 18%. After 2006’s dubious year for properyy investment in Southern Spain, the new tax reduction which came into effect on 1st January 2007 has drawn a huge volume of property investors and buyers back into the Spanish property market by having one of the lowest property Capital Gains Tax throughout Europe, making Spanish investment property on the Costa Del Sol an excellent choice.
The revised capital gains tax which has been met by property investors as a highly positive political maneuver. The new reduction balances the tax liabilities onto a level playing field for both Spanish residents and non-residents , and thisin conjunction with clear plans to regenerate Marbella and the surrounding regions of the Costa Del Sol, will now see increased levels of confidence from investors, holiday home buyers and buyers making a permanent move to Marbella and the Costa del Sol area.
This is a new and exciting time for property buyers and never has the economics of supply and demand been so paramount. Hightened planning restrictions will limit the amount of beachfront and beachside property being constructed and this can only mean one thing — prices will begin to rise at a correctional and positive stable rate again. At present capital growth in prime areas is between 9-12% per annum and with limited licenses being grated in the future, the market will see inevitable increases.
