Spain is not ending the Golden Visa program. However, the government is planning serious changes to the investment options.
The Spanish government is taking some steps to moderate the golden visa in Spain. Historically, Spain’s residency by investment program is known to allow foreign investors to obtain residency by buying a property worth €500,000 or more as the main popular route.
These days, why the program’s future is critiqued depends on the announcement made during the Council of Ministers in April 2024. The announcement signals that there is going to be a significant shift in immigration and housing policies that aim to address domestic housing challenges in Spain.
CLICK HERE to view a short video on the Spanish golden visa in Spain.
What is the Spanish Golden Visa?
The Spanish Golden Visa is a residency by investment program that offers non-EU nationals the opportunity to obtain residency in Spain in exchange for a significant investment in the country. Introduced by the Spanish government, the program aims to attract foreign investment and stimulate economic growth. The Golden Visa program is ideal for individuals who wish to live, work, and study in Spain, providing a clear pathway to permanent residency and, eventually, Spanish citizenship.
Eligibility Criteria
To qualify for the Spanish Golden Visa program, applicants must meet specific criteria.
The minimum investment required includes €500,000 in real estate, €2 million in Spanish Government Bonds, or €1 million in shares of Spanish companies.
Additionally, applicants must be at least 18 years old, have a clean criminal record, and hold a private or public health insurance policy. They must also demonstrate sufficient financial means to support their stay in Spain without needing employment.
Popularity of Spain’s Golden Visa Program
Spain’s Golden Visa Program, also known as the Golden Visa Spain, started in 2013, and since then, it has continued to attract foreign capital. This attention was especially intense during the eurozone crisis, which also severely impacted Spain’s real estate market.
Over 6,200 golden visas from Spain have been granted for the property investment option alone. The program became particularly popular among Chinese, Russian, and Iranian investors.
However, especially after Brexit, the United Kingdom also had significant numbers and the United States, with Americans looking for a second destination in Europe.
House Market in Spain and the Evaluations
The economy of the country gets foreign capital through the Golden Visa investment. However, as the Spanish government has highlighted, recent evaluations show that 94% of the golden visas given in Spain focused on the major urban areas, significantly impacting the Spanish real estate market. So, housing markets in Madrid, Barcelona, and the Balearic Islands are increasingly strained.
The Prime Minister of Spain, Pedro Sánchez stated that the reform, which is to remove the real estate investment option from the golden visa investment alternatives, aims to transition housing from a “speculative business” to a fundamental right.
From this emphasis, we understand that, as it happened in Portugal, the expectation from golden visa investments is getting away from the property market but seems to be continuing with other investment options.
However, this change is not going to happen immediately. The exclusion of real estate buying to get a residency in Spain is not expected to be active until 2025 but the date is not announce officially yet.
What are the Alternatives to Property Investment?
Even if the intended abolition of property-based golden visas becomes a reality in Spain, the golden visa program will still be available with other investment alternatives. One such alternative is bank deposits, which require a minimum investment of €1 million and offer financial security and ease of management. Those can be substantial investments in government bonds or dynamic Spanish companies. Another option is investing a minimum of €2 million in Spanish public debt securities, which provides a stable investment and qualifies investors for residency.
When real estate investment is still an option, these other investment alternatives seem to keep representing a smaller fraction of all the overall golden visas issued in Spain. Spanish financial institutions play a crucial role in providing essential services and security for these investments, ensuring compliance with Spanish regulations and supporting the economy.
Commercial options are available for the Golden Visa, these qualifying investments start at €383,000 due to the way they are structured, these can provide a stable investment and also a quick pathway to residency. If you would like to know more & book a free 1 to 1 meeting simply CLICK HERE
The Critics Against the Real Estate Investment Option
Why do European countries, such as Portugal and Spain, seem to have critics against real estate investments made by foreigners who apply for golden visa programs?
The critics are mainly on the underlying issues of housing availability and affordability in Spain, as Francisco Iñareta from Idealista suggests. The golden visa seems unlikely to resolve this problem. The challenges mostly stem from the escalating demand for housing in Spain and a dwindling supply. Therefore, it doesn’t seem to be a problem occurring from the investment-driven residency program but the results and effects on the real estate market and the local buying capabilities.
Additionally, consulting with professionals who have expertise in Spanish immigration and investment laws, particularly highlighting the National Securities Market Commission, is essential. A thorough understanding of the Commission’s regulations ensures compliance in financial investments related to visa applications.
Golden Visa Trends in European union
Spain’s decision to move to a golden visa program without real estate investment follows Portugal’s updates. Portugal’s golden visa program, also known as an investor visa, is still active and receives applications through the fund investment option, which became the popular investment type after the changes.
Some countries, like the UK and Ireland, have already terminated their respective golden visa programs. Meanwhile, Portugal and the Netherlands continue with their modified programs that exclude property investments.
Portugal’s Golden Visa program became more attractive after changing its citizenship law in 2024. After the announcement, they made it easier to apply for citizenship through the Golden Visa program. If you apply for the Portuguese Golden Visa program, you can apply for citizenship after the 5-year waiting period, which starts to count with the initial residency application regardless of the approval.
Application Process
Applying for the Spanish Golden Visa involves a detailed process that requires careful preparation and submission of various documents. Applicants need to provide a valid passport, proof of health insurance, and evidence of sufficient financial resources.
The application can be submitted through a Spanish consulate or, if the applicant is already in Spain legally, through a public registry office. The Spanish authorities aim to communicate their decision within 20 working days from the date of submission.
Its a quick painless application much better than other similar programs around the world.
Benefits of the Golden Visa in Spain
The Golden Visa program offers numerous benefits to international investors. It provides residency and the potential for Spanish citizenship, allowing investors and their families to live, work, and study in Spain.
The program also facilitates family reunification and grants freedom of movement within the Schengen Area. Additionally, investors gain access to Spain’s high-quality education system and comprehensive healthcare services. Economically, the Golden Visa opens opportunities to establish businesses or engage in employment within Spain, enhancing the overall quality of life for investors and their families.
How Will the Program Move Forward?
It is still a question of how Spain will manage the transition to the Spain Golden Visa program without the real estate investment option. The upcoming reform reflects the need to balance foreign investments with affordable housing for the local population in Europe. Therefore, this recognition grows in Europe and among potential investors.
These changes still unfold. Also, potential investors and current visa holders might still consider residency options as investment opportunities in Spain’s Golden Visa program.
The debate continues about the best way to balance economic incentives with social welfare. However, discussions around European golden visa programs suggest that these programs help shape the future of residency through investment across the continent.
Frequently Asked Questions
Can I still apply for a Spain Golden Visa by buying real estate?
Yes, you can submit your Golden Visa application in Spain by investing in real estate worth €500,000 or more or via a commercial option form €383,000, it is still possible.
CLICK HERE to see a video explaining the program or CLICK HERE to book a free 1 to 1 with Robin