The Spanish Prime Minister, Pedro Sánchez, announced that he will eliminate the residence permit for non-European citizens who will make a significant real estate investment in Spain, commonly known as the Golden Visa.
In this way, Spain joins other countries that have eliminated the Golden Visa, such as Portugal or the United Kingdom, which have already proposed the elimination of its Non-Doms regime.
WHAT IS THE GOLDEN VISA?
Approved in 2013, the Golden Visa was intended to attract foreign investment. It allowed non-resident foreigners to enter Spanish territory with the intention of making a significant investment. Among the options contemplated were investments of between €1 million and €2 million, business projects of "general interest" and the purchase of real estate worth at least €500,000.
However, now the Spanish government proposes to eliminate the possibility of obtaining this visa only through the acquisition of real estate in Spain with an investment of EUR 500,000 or more, which represents almost 95% of the Golden Visas, in order to combat real estate inflation and "guarantee that housing is a right and not a mere speculative business".
The granting of the residence visa for investors constitutes a sufficient permit to reside and work in Spain, in addition to providing authorization to move freely within the Schengen area during its validity. It also had the special attraction of requiring only one annual trip to Spain and not requiring a minimum number of days of stay in the country.
POSSIBLE EFFECTS
The elimination of this visa is expected to have several effects, the most immediate being a loss of approximately 550 million euros per year (according to official data for 2023) in foreign investment. Certain referents of the real estate sector believe that this measure may not be significant in reducing the prices of the real estate market in Spain, which is the intention behind the elimination of this Golden Visa system.
The unknown is where this real estate investment, which since its implementation has attracted more than 10,000 visas for high networth individuals, mostly from China, Russia (until the beginning of the war), the United States and Latin America, will go. Within the European Union, countries such as Italy, Greece, Malta and Hungary still maintain these attractive regimes for foreign investment and will be the biggest beneficiaries.
With respect to the Golden Visa already granted, it is understood that they will not be affected, in accordance with the principle of retroactivity.
If you are looking for additional information or to understand how this change could affect your personal situation, as well as to explore alternatives to obtain residency in Europe with attractive regimes, please do not hesitate to contact us.