If you have extra supply of houses needing renovation, as in the comment, and renovations require labor and/or materials to complete, having foreigners pay to renovate houses to be livable will decrease the ability of Spaniards to renovate houses to be livable.
For example, let's assume renovations are 100% completed by local crews. Any crew working for a foreigner is working for them because A) the foreigner is paying more than a local for the work B) the foreigner is paying enough to make a profit and the local isn't (which is a subset of A). There is no situation in which adding foreign money results in more houses for locals. If you eliminate the ability for foreigners to renovate, the renovation crews will take the money that the locals can pay. There will be fewer renovation crews, because some crew will not be profitable at the lower rate, but more crews working to renovate houses for Spaniards.
Similarly, for materials, given supply and demand curves (and assuming that the marginal units added won't cause economies of scale) eliminating the ability for foreigners to buy materials for renovations will move the curve intersection down to a lower price and volume.
> There is no situation in which adding foreign money results in more houses for locals
Assuming fixed supply, yes, it's (probably) a zero-sum game.
> eliminating the ability for foreigners to buy materials for renovations will move the curve intersection down to a lower price and volume
Assuming a frictionless market and no economies of scale, yes. In reality, you'll have a smaller set of options for locals at a slightly (but not dramatically) lower price. (Again, for an example look at all the markets foreign investors shun.)
> will be fewer renovation crews, because some crew will not be profitable at the lower rate, but more crews working to renovate houses for Spaniards
You absolutely cannot conclude this from first principles.
You make valid points. They just need to be followed up with data. The systems you're talking about are too sensitive to generalise like this.
For example, let's assume renovations are 100% completed by local crews. Any crew working for a foreigner is working for them because A) the foreigner is paying more than a local for the work B) the foreigner is paying enough to make a profit and the local isn't (which is a subset of A). There is no situation in which adding foreign money results in more houses for locals. If you eliminate the ability for foreigners to renovate, the renovation crews will take the money that the locals can pay. There will be fewer renovation crews, because some crew will not be profitable at the lower rate, but more crews working to renovate houses for Spaniards.
Similarly, for materials, given supply and demand curves (and assuming that the marginal units added won't cause economies of scale) eliminating the ability for foreigners to buy materials for renovations will move the curve intersection down to a lower price and volume.