Political discussions about possible restrictions on foreign property buyers continue in Spain. One of the most notable examples in recent weeks has been the situation in the Balearic Islands.

📜 Lawmakers considered an initiative that would have allowed property purchases only for foreign buyers who had lived on the islands for at least five years. However, at the end of February the regional parliament of the Balearic Islands rejected the proposal, meaning the local real estate market remains open to international buyers.

The very appearance of such an initiative highlights how acute the housing issue has become in Spain’s tourist regions. The Balearic Islands are among the markets where pressure from external demand is particularly strong:

— housing prices in the Balearic Islands are about 40% higher than the national average in Spain;
— on the island markets, foreign buyers account for about 31.47% of all housing transactions;
— across Spain in 2025, foreign buyers represented approximately 13.5–13.8% of all property transactions.

🌍 Strong international demand is supported by several factors at once: limited housing supply, a stable tourism flow, the attractiveness of the region for second homes, and consistent interest from buyers from the United Kingdom, Germany, and Northern Europe.

Opponents of the proposed law pointed to a potential conflict with the European Union principle of free movement of capital, as well as the risk of reducing the region’s investment attractiveness. Market participants also emphasized that the main driver of rising prices is not only foreign demand but also the chronic shortage of housing supply. Because of this, even strict restrictions on foreign buyers would not necessarily lead to a real decrease in prices.

📈 Despite ongoing regulatory discussions, the real estate market in the Balearic Islands remains open. This is particularly relevant for buyers who are considering property in Spain for one of the following purposes:

— purchasing a second home by the sea;
— investing in a property with rental potential;
— partial or long-term relocation;
— preserving capital in liquid resort real estate.

🔎 You can explore available property listings in the Balearic Islands and other regions of Spain on our website.