Spain's Loss Is Portugal's Gain

The end of the Spanish Golden Visa

The highly successful Golden Visa program is concluding in Spain next week, effectively closing the opportunity for hundreds of British, American, and other non-European Union citizens who wished to relocate to Spain with minimal paperwork. This program has enabled thousands of non-EU citizens to obtain Spanish residency by purchasing a home valued at over 500,000 euros.

However, Spain's loss might be Portugal's gain, as the Portuguese government is accelerating the Golden Visa program to attract more individuals.

According to The Portugal News, "The minimum capital required to qualify for the Portuguese Golden Visa is currently €168,000. These lower thresholds make Portugal a very cost-effective EU residency option, which many investors will find appealing."

The visa, both in Spain and Portugal, has been extremely popular with U.S. citizens moving to Europe, possibly due to political uncertainty.

Real estate agents have expressed that the end of the Golden Visa in Spain is a significant setback, and they worry that non-EU citizens may turn to other countries like Greece and Portugal that still offer visa programs.

Reasons for Spain’s decision to terminate the Golden Visa scheme for foreign investors 

The abolition of the Golden Visa is attributed to several reasons, according to proponents of this measure. Here are the main motivations:

1.    Negative impact on the Spanish real estate market:

The removal of this scheme is partly due to the significant increase in property purchases by foreign investors, which has notably impacted the Spanish property market, especially in certain areas. This trend has driven up housing prices and, in some cases, led to gentrification, making it harder for local residents to find affordable housing.

2.   Questionable economic effectiveness:

According to the amendment text, it is noted that other forms of investment associated with this program have not significantly impacted the economy, raising questions about its effectiveness as a tool for attracting foreign capital. This has been a key factor in eliminating all investor visas, not just those for real estate investment, as initially planned. Although other investment channels have not been widely used, their usage might increase once they become the only option.

3.   Limited residency options for non-EU nationals:

Spain offers other residency options for those who do not wish to reside permanently and become tax residents but do not want to be limited by the maximum tourist stay limits. These include non-profit residency or residency as a “digital nomad,” although all require spending more than six months in the country each year.

4.    Security concerns:

The measure also reflects a broader trend at the European level to review or tighten investment visa programs. Since the Russian invasion of Ukraine, several European Union (EU) countries have begun restricting such permits due to security and transparency concerns, particularly regarding the origin of funds.