European Commission experts propose that real estate inheritances, capital gains from the sale of apartments, and vacant land should be taxed more heavily.

The housing crisis has reached a point where the European Commission no longer sees it as a temporary imbalance, but as a structural failure affecting much of the EU housing market. This is the main conclusion of the Housing Advisory Board report, which will form the basis of the upcoming European Affordable Housing Plan, expected to be presented in 2026.

The diagnosis is clear: current fiscal resources are insufficient to address the sustained rise in housing costs, particularly in major cities. Barcelona and Madrid are among the European cities where housing absorbs the highest share of average salaries, highlighting how far prices have diverged from income growth.

In response, the Commission is proposing a deep rethink of housing-related taxation. The focus is not simply on raising taxes, but on redirecting the taxation of certain forms of real estate wealth—high-value housing inheritances, capital gains from property sales, and vacant urban land—towards the financing of affordable housing.

Regarding housing inheritances, the report suggests that Member States should reconsider taxation on higher-value estates, especially second and third homes that have seen strong appreciation. The rationale is that much of this increase in value stems from decades of public investment in infrastructure, services and urban development, and therefore justifies a greater public return.

The report also highlights the role of urban land value gains and vacant plots. In many cases, increases in property value driven by public decisions are fully captured by private owners or developers, while the public sector bears the cost. To address this imbalance, the Commission recommends strengthening value-capture mechanisms such as land contributions, mandatory reserves of affordable housing in new developments, and more automatic systems to fund infrastructure and regulated rental housing.

Another key recommendation is to increase taxation on underused urban land and derelict buildings in high-demand areas. The aim is to discourage speculative land hoarding, accelerate urban regeneration and bring idle land back into productive use, particularly in consolidated city centres.

The expansion of short-term tourist rentals is also identified as a major factor reducing housing supply and pushing up rents. The report calls on the European Commission to support Member States in regulating these rentals through permit systems, zoning rules and monitoring tools. It even proposes the creation of dedicated funds—financed by tourist rental platforms—to tackle homelessness and housing exclusion.

At the same time, the experts advocate for the expansion of cost-based rental housing across the EU. Under this model, rents are set according to actual development and operating costs rather than market prices, limiting investor returns by design and positioning affordable housing as a form of social infrastructure.

While the Commission has yet to specify which recommendations will become law or when, the direction is clear: housing is becoming a central issue of fiscal, urban and industrial policy at the European level. In countries such as Spain, these proposals intersect directly with ongoing debates around inheritance tax, vacant housing surcharges, tourist rental regulation, urban value capture and the urgent need to expand affordable housing supply at scale.