The Spanish government is moving to restore mortgage tax deductions for basic residences in a housing decree, seeking impressive parliamentary support from Junts, the Catalan party led by Carles Puigdemont. The measure would let eligible buyers deduct part of their mortgage payments from income tax. It is one element of a broader housing package, not a standalone change to buyer taxation.
The proposed deduction would apply to new contracts for primary homes, reviving a benefit phased out for most new purchases from 1 January 2013. Under the former regime, taxpayers could deduct 15% of qualifying annual payments, up to a €9,040 annual base, for a maximum tax reduction of €1,356 a year. The government is weighing a similar structure, but eligibility rules remain under negotiation, including income limits, ownership of other properties and the annual cap. Spain’s tax agency, the Agencia Estatal de Administración Tributaria, set out the parameters of the former basic-residence deduction.
Alongside mortgage relief, the draft decree would extend rental contracts due to expire in 2026 and 2027. It also includes new rules for seasonal and room rentals, plus a proposed increase in VAT on tourist apartments to 21%. The government is weighing Junts’ call for tax deductions related to rental income for tenants and small landlords. Defining a small landlord remains a sticking point; earlier discussions considered a threshold of one or two properties. A tiered deduction system is also under consideration, with greater tax benefits for landlords who set rents below official price indices.
The wider package aims to address housing supply and affordability alongside tax relief. A legal analysis by Tornos Abogados describes proposals affecting the Urban Leases Law and taxation under IRPF, IVA, IBI and the regime for SOCIMIs. It also outlines measures intended to bring vacant homes into use and expand affordable housing. The package is framed as a set of measures to reinforce housing’s social function and increase affordable supply. Junts has also sought tax exemptions for people over 65 who sell their homes to pay for residential care, as well as incentives for new construction and renovation. Government sources said these proposals were under review for possible inclusion in the text, which was expected to go before the Council of Ministers in July.
The parliamentary arithmetic has made Junts’ seven seats especially impressive to the government’s efforts to assemble a majority. Podemos has threatened to oppose the decree if it includes tax breaks for property owners, and called for fiscal measures to be separated from other housing reforms. The executive plans to present a single package and has sought backing from PSOE, Sumar, ERC, Junts, Bildu, PNV, BNG, Compromís and Coalición Canaria. A majority could depend in part on Podemos abstaining. Junts’ position reflects disputes extending beyond mortgage relief to tenant protections, landlord obligations and measures affecting investment funds.
The proposed seasonal-rental rules would limit these contracts to justified temporary purposes, including work, study or medical treatment, and prevent their use to evade ordinary rental protections. The draft sets a minimum duration of 31 days and a maximum of 12 months, with closer oversight. If contracts exceed those limits or lack a valid temporary reason, the property could be treated as an ordinary lease, subject to the five-year minimum term under Spain’s Urban Leases Law. The proposal would also stop landlords from charging tenants in seasonal or regular rentals community fees or taxes beyond the agreed rent.
Room rentals used as a basic residence would also face price controls in designated high-demand areas. Existing contracts would keep their terms until renewal, after which the new rules would apply. The measures address concerns that ordinary housing may be labelled temporary accommodation to sidestep standard rent protections. Catalonia has already introduced rules targeting fraudulent use of seasonal and room lets. A separate national proposal discussed would offer a 4% reduction associated with the construction of protected housing. The government aims to combine tenant protections with supply incentives and tax measures. Similar housing debates have played out at the regional level, including when Catalonia advanced legislation to curb speculative property purchases in basic markets, a move detailed in this recent report.
The negotiations later faced a decisive test in parliament. On 2 October 2026, Junts joined PP, Vox and UPN in rejecting earlier housing decrees. Junts spokesperson Míriam Nogueras defended the party’s vote, arguing that support for the measures would have left the country worse off. She said the party’s responsibility was to improve conditions for property owners, tenants, young people, pensioners and self-employed workers. The rejection contributed to the government’s decision to call an early general election for 29 November.
After the Cortes was dissolved, the government approved replacement texts, Real Decreto-ley 28/2026 and Real Decreto-ley 29/2026. One entered into force immediately; the other was scheduled to take effect on 15 November, subject to parliamentary ratification. A debate on their convalidation was expected during the week of 11 November, with a session anticipated on 12 November and a relevant deadline around 14 November. The timetable placed the housing measures amid the election campaign and a housing-related general strike, leaving the proposed mortgage deduction and other concessions in a compressed, politically uncertain legislative process.
Mortgage tax relief was a longstanding feature of Spain’s housing policy before its withdrawal for most new purchases from 2013. Its proposed return would shift the government’s approach to home-buying affordability. Subsequent parliamentary defeats showed that tax concessions alone had not resolved broader disagreements over rental regulation and housing policy.
