In the last few years, many European countries – including Greece, Malta, Portugal, The Netherlands, and Ireland – have amended or completely scrapped their ‘Golden Visa’ programmes due to concerns over their effects on local housing markets.
Rumours of Spain following suit have abounded for the past year or more – but as of early April, the newest Spanish government has announced its firm intention to get rid of the option to gain residency through real estate investment in Spain.
So, what does this mean for those who want to apply for a Golden Visa in Spain? How exactly is the scheme changing, and how will this affect existing Spanish Golden Visa holders? Read on to discover the answers to these pressing questions.
What is the Spanish Golden Visa scheme?
The Spanish Golden Visa (Visado de Oro) was launched over a decade ago in 2013, with the aim of rebuilding the Spanish property market via foreign investment.
It currently allows non-EU nationals to obtain Spanish residency by investing in property, Spanish businesses, or government bonds – with the additional perks of bringing family members to Spain, remaining a non-tax resident if desired, and freedom of movement throughout the Schengen Area.
Investing a minimum of 500,000€ in Spanish real estate is widely seen as the fastest route for foreigners to gain residency in Spain, with the majority of the almost 15,000 Golden Visas granted being claimed through property purchases.
However, Golden Visa schemes in Europe have been subject to increasing scrutiny, with accusations of criminal gateways and unfair access for the wealthy – but the Spanish prime minister has now said the country will be putting a stop to this.
Why is Spain scrapping the Golden Visa?
Over recent years, the rise of rental properties as short-term tourist lets has angered Spanish nationals, who believe that an influx of mostly wealthy foreign property buyers are responsible for pricing local people out of housing in their own neighbourhoods.
The government believes that Golden Visas have contributed to this issue, as the majority of approved visas are for real estate investments in major cities like Madrid, Barcelona, Malaga, and Valencia – where property prices have been rising drastically.
The Prime Minister, Pedro Sánchez, has stated that housing should be a constitutional right in Spain, not a speculative market, which is why the government are looking to eliminate the granting of residency through real estate investment.
The Minister of Culture, Ernest Urtasun, added further criticism – claiming that Golden Visas awarding residency to the wealthy makes others ‘second-class’ citizens.
Despite this, many housing market experts believe that cancelling the Spanish Golden Visa wouldn’t actually help those who find themselves priced out of local real estate – and could even harm the Spanish economy, by discouraging further investment from foreigners from European countries.
What happens if you have a Golden Visa?
As this announcement only indicates the government’s initial plans to no longer uphold the Golden Visa scheme in its current form, it’s not yet known whether foreigners who already have a Golden Visa will be allowed to continue with the scheme.
However, Spanish immigration lawyers believe that changes to Golden Visa rules will not apply retroactively – meaning that anyone who has been approved for the visa before the date that any changes legally come into force will not be affected.
Spanish Golden Visa holders should therefore be allowed to continue following the rules of the scheme at the time of their authorisation, maintaining residency in Spain under the previous requirements (e.g. maintaining their investments).
This should also be true for anyone who is currently in the process of applying for a Spanish Golden Visa – no new laws have been passed yet, and if they do come into effect in the near future, the government should set a deadline for applications under the current rules before the scheme closes to new applicants.
It seems unlikely that the Spanish government would expect approved Golden Visa holders to switch to a different visa and secure residency by alternative means, but there’s always the possibility that they could try to change the terms and conditions.
Is it too late to apply for a Golden Visa now?
The Prime Minister’s wording does imply that the government is totally committed to removing the Golden Visa programme in the next few months – but only in regard to the real estate investment route, as the other investment options have not been mentioned.
Therefore, until the government finalises any legal changes, it is still possible to apply for a Spanish Golden Visa by investing in Spanish property at the moment – and even if this option is removed, it may still be possible to apply through several other investment routes if the scheme is not scrapped completely.
The Golden Visa application procedure is known for relatively quick processing, though applicants must factor in the time it takes to choose and complete their investments in Spain, so it’s best to apply without delay if you’re thinking of obtaining Spanish residency through property investment.
If the programme is closed down completely, there will no longer be a visa option that allows holders to maintain residency without spending a minimum amount of time in Spain each year – if forced to switch to alternatives, such as the non-lucrative visa or digital nomad visa, foreigners would typically have to spend at least half a year in the country, which would make them liable for the same taxation as a full-time resident.
Should you have any questions about your visa options for residency in Spain, or how these events could affect your ability to obtain or keep a Spanish Golden Visa, it’s best to consult English-speaking Spanish solicitors.
They will know the latest developments regarding all the available Spanish visas and how they affect non-resident tax in Spain, and can help with applications and liaising with the Spanish authorities on your behalf.
