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What are ‘golden visas’ and how do they affect foreign residents?

Date: May 20, 2024 Time: 03:37:20

The so-called ‘golden visa’ have found their end this month following the initiative of the Government of Spain to eliminate this benefit to, according to the President of the Government Pedro Sánchez, “guarantee that housing is a right and not a mere speculative business.” Golden visas guaranteed the tax benefit that the country gave to foreigners residing outside the European Union to obtain a residence permit through an investment of at least 500,000 euros in houses, apartments or other real estate.

However, an investment of more than half a million euros in real estate on Spanish soil was not the only way to access these visas. Foreign luxury investors who want to obtain a residence permit in Spain could also do so through investment in financial assets, with two million euros in Spanish public debt or one million euros in shares of national companies, in bank deposits. . or in investment funds, according to data from the Ministry of Economy, Commerce and Business.

Since 2013, when this type of visa was implemented, almost 14,580 visas have been granted in this way. In 2016, 461 real estate visas were issued, in 2017, 947; in 2018, 998; in 2019, 861; in 2020, 632; in 2021, 997; In 2022, 2,017 and in 2023, 3,273 visas were obtained. “Starting in 2022, the alarms go off and, therefore, having doubled the concessions, we intervene,” explained the Minister of Housing and Urban Agenda, Isabel Rodríguez, at the beginning of the month.

Since the announcement of the elimination of this privilege, real estate portals have criticized the initiative. “It is bad news for foreign investment and for residential tourism, a strategic sector in the province of Malaga that has become the main generator of employment and wealth and that also contributes to combating seasonality,” said Javier Pérez from Vargas, expert lawyer in the real estate sector and associate of DOM3.

How does the elimination of the ‘golden visa’ affect the real estate market in Spain?

However, the measure is not expected to affect the luxury real estate market. Since expectations regarding the growth of the sector continue. Specifically, Knight Frank, from the Association of Real Estate Consultants (ACI), anticipates a 5% growth in the price of the most exclusive segment in the city of Madrid, as a consequence of the “irrelevant” impact of the decision on the market.

According to the 2023 Yearbook of the Real Estate Registry Statistics, in 2023 foreign investors in Spain accounted for 14.98% of the homes sold. Despite a global decline in home sales, foreign demand remained strong.

Specifically, for the second consecutive year, the proportion of homes purchased by foreigners (almost 15%) exceeded the historical mark of 2022 (13.7%). Specifically, foreign buyers acquired 87,400 homes last year compared to almost 88,000 in 2022.

Regions in which luxury investment has the most impact

The cities in which luxury investment has had the most impact have been Marbella, with 7.1% of the homes acquired within this model, Barcelona, ​​​​with 5.3% and some municipalities in the Balearic Islands, where These acquisitions represent 10%.

The main provinces targeted by this type of businessmen are Barcelona, ​​​​Madrid, Málaga, Alicante, the Balearic Islands and Valencia, according to data from Minister Isabel Rodríguez. And most of them come from China, Russia, the United Kingdom, the United States, Ukraine, Iran, Venezuela and Mexico.

* This website provides news content gathered from various internet sources. It is crucial to understand that we are not responsible for the accuracy, completeness, or reliability of the information presented Read More

Puck Henry
Puck Henry
Puck Henry is an editor for ePrimefeed covering all types of news.
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