Spain is putting an end to its Golden Visa program, a residency-by-investment initiative introduced in 2013 to attract foreign investors. This decision, announced in April 2023, will come into effect in April 2024. The program, which granted residency to non-EU nationals investing €500,000 or more in Spanish real estate, is now being phased out due to its impact on the housing market and increasing concerns about affordability for local residents.
What Changes Are Being Made?
Under the new legislation, published in the Boletín Oficial del Estado (BOE), key sections of the 2013 Entrepreneurial Support Act that enabled the Golden Visa program will be repealed, including:
• Residency by Real Estate Investment: The most popular route, allowing residency for those investing over €500,000 in Spanish properties.
• Other Investment Routes: This includes investing €2 million or more in Spanish government bonds, €1 million in Spanish companies, or creating a business project of “general interest” in Spain.
Applications submitted before the law takes effect in April 2024 will still be processed under the current rules. Additionally, renewals for existing visas will follow the legislation in place at the time of their initial approval.
Why is the Golden Visa Being Terminated?
The primary reason for discontinuing the Golden Visa program is the strain on housing markets in major Spanish cities like Madrid, Barcelona, Valencia, Malaga, Alicante, and the Balearic Islands. According to Prime Minister Pedro Sánchez, 94% of Golden Visas are tied to real estate investments in areas experiencing housing shortages and rising rents, making it increasingly difficult for local residents to find affordable homes.
This move aligns with broader European Union efforts to phase out similar programs due to concerns over security risks and economic inequality.
Who Benefited Most from the Golden Visa?
The program has been highly popular among non-EU investors, particularly:
• Chinese Nationals: Over 50% of the visas in 2023 were granted to Chinese citizens (2,712 visas).
• Russians: The second-largest group, with 1,159 visas.
• Other Nationalities: Including Iranians (203 visas), Americans (179 visas), and British nationals (177 visas).
In 2023 alone, 6,200 Golden Visas were granted for real estate investments, generating significant foreign interest in Spanish properties.
Implications for Real Estate Investors
For those considering investing in Spanish real estate, the end of the Golden Visa program means exploring alternative strategies. While residency-by-investment will no longer be an option, Spain’s real estate market remains attractive for its stability and potential returns. Marbella, in particular, continues to offer excellent investment opportunities due to its luxury properties, strong rental demand, and appeal to international buyers.
Alternative Residency Options
With the Golden Visa program ending, potential investors and expats can consider:
• Non-Lucrative Visas: For those with sufficient financial resources to live in Spain without working.
• Work Visas: For individuals planning to start a business or take up employment in Spain.
• Digital Nomad Visas: For remote workers who wish to live and work in Spain.
At Move2Marbella, we have over 35 years of experience advising individuals and businesses on how to relocate, retire, or invest in Spain. Our team can help you navigate these changes and find the best residency option for your specific needs.
Conclusion
The end of Spain’s Golden Visa program marks a significant shift in the country’s approach to foreign investment. While this change may limit certain pathways to residency, it also highlights the Spanish government’s commitment to addressing housing challenges and ensuring fair opportunities for all.
If you’re considering investing in Spain or need guidance on residency options, contact us today. We’re here to help you achieve your goals and make the most of Spain’s opportunities for living, working, and investing.
