The Balearic Islands government plans to abolish regional taxes on first-home purchases for buyers under 36, and to halve them for buyers up to 40. Regional president Marga Prohens announced the measures on Tuesday 20th October during the annual Debate on General Policy, the last of the current legislative term.
What is changing
- Under-36s buying a first home: both regional purchase taxes would be scrapped. These are the transfer tax (Impuesto de Transmisiones Patrimoniales) and stamp duty (Actos Jurídicos Documentados).
- Buyers aged up to 40: the same two taxes would be cut by half.
- Mortgages for people with disabilities: a 50% reduction in stamp duty on mortgage loans.
- Young savers: a new regional income tax deduction for “young savings accounts” used to save for a first home.
- Tourist tax: revenue from the Sustainable Tourism Tax will be redirected towards easing the housing emergency, backed by changes to the law.
More support for young buyers
Public guarantees for the “Nueva Hipoteca Joven” (New Youth Mortgage) scheme will rise from €30 million to €45 million. Funding for the €10,000 grants for under-40s buying a home will also be expanded to reach more people.
Homes for key workers
The government announced 80 homes for healthcare professionals in Ibiza and 40 for teachers posted to Formentera.
A new housing strategy: “HabitaIB 4+4”
Prohens said the government is drawing up a Strategic Housing Plan, due to be presented before the end of the year. It combines 50 measures already approved or under way since 2023 with 50 new ones to be carried out between 2027 and 2031. It aims to reach 87,000 people, with an expected economic impact of €3 billion.
The plan is expected to include:
- new public housing developments
- support for building subsidised (protected) housing
- grants to renovate empty homes for use as affordable rentals for residents with at least five years’ residence in the islands
- a register of undeveloped plots
- a register of unfinished or obsolete buildings that could be converted into housing
A pilot scheme for older people at risk of housing exclusion was also announced.
The political context
Prohens, a member of the Spanish People's Party (PP), defended her government’s approach against what she called proposals that have failed elsewhere. Without naming them, she was referring to measures that, in her view, shift responsibility onto small landlords, drive properties off the rental market, stall new contracts and push prices up. She said her government has spent three years building affordable housing and helping young islanders.
