Key Takeaways:
- Despite announcing plans five months ago, Spain has not yet abolished the real estate investment option from its Golden Visa Program.
- The real estate route is the most popular option for acquiring residency through Spain’s Golden Visa Program.
- While the government discussed the program’s abolishment in April, no final decision has been made.
Spain’s Golden Visa Program and Real Estate Investment
In April 2024, Spain’s Council of Ministers announced plans to eliminate the real estate investment option from the Golden Visa Program. This change is part of Spain’s strategy to tackle its growing housing crisis. However, despite the announcement, foreign nationals can still apply for residency by purchasing property worth €500,000 or more.
The Golden Visa Program, introduced in 2013, allows foreign investors to gain residency in Spain by investing in real estate. To date, over 14,000 golden visas have been issued under this program. The most common nationalities benefiting from this scheme include China, Russia, the United Kingdom, the United States, Ukraine, Iran, Venezuela, and Mexico.
Why Did Spain Plan to Abolish the Real Estate Investment Option?
In a bid to improve housing affordability and availability for locals, Spain’s Minister for Housing, Isabel Rodríguez, emphasized that scrapping the real estate investment route would be crucial. The Spanish government believes foreign investments in property are contributing to speculative markets, driving up prices, and worsening the housing crisis for Spanish citizens.
Pedro Sanchez, Spain’s President, reiterated that the Golden Visa Program, initially introduced to boost the economy, is now being reevaluated. “Housing is a right, not a speculative business,” Sanchez stated during a public address.
Will Spain Abolish the Program?
Though the government announced its intentions in April 2024, no concrete decision has been made. This delay has allowed foreign investors to continue applying for visas under the real estate route. Experts and market observers are closely watching how the decision may impact the housing and real estate markets in Spain, as foreign demand has played a pivotal role in the property sector.
Comparisons to Portugal and Greece
Spain isn’t the only country reconsidering its Golden Visa Program. Portugal abolished its real estate investment option in early 2024, while Greece raised the minimum investment amount for the same. Both countries aim to curtail speculative housing practices and respond to their own housing challenges.
Despite the benefits these programs have brought to national economies, they have been scrutinized for their association with money laundering and corruption.
Conclusion
For now, foreign nationals looking to invest in Spanish real estate can still take advantage of the Golden Visa Program, but the government’s pending decision may change that soon. Investors should keep an eye on future announcements regarding the program’s fate as Spain continues to balance economic growth with its housing policies.
