The end of the Golden Visa in Spain: Experts discuss impact
In an announcement by Pedro Sánchez, the President of the Spanish Government, the end of the golden visa has been declared, with the Council of Ministers swiftly formalizing the decision within a mere 24 hours. The governmental initiative to cease the issuance of residency permits to non-EU foreigners investing more than €500,000 in real estate is underway.
End of the Golden Visa - Spain's stance towards foreign investment
To glean insights into the repercussions, idealista/news reached out to premier luxury real estate agents in Spain. Their assessment suggests that while the move deals a blow to the sector by removing an enticing option for select investors, the anticipated impact remains constrained, given that the majority of foreign investors do not pursue Spanish real estate for residency purposes. Nevertheless, the decision is perceived as indicative of Spain's stance towards foreign investment.
Initially introduced to entice international clientele from outside the EU and Schengen Area, the golden visa program has seen minimal traction since its inception in 2013. According to a Lucas Fox representative, the majority of real estate transactions involving international clients in Spain originate from within the EU or are unrelated to the golden visa scheme. Thus, the actual influence on market dynamics has been and is expected to remain minimal. However, the announcement of the program's phasing out is predicted to trigger a surge in interest from investors who had been contemplating its utilization.
End of the Golden Visa - Spain's intrinsic qualities
Luis Valdés, the Managing Director of Residential Sales Advisory at Colliers, contends that the measure's impact, while negative, is inconsequential for the real estate landscape. He asserts that foreign investors are primarily drawn to Spain's intrinsic qualities—quality of life, safety, education, and recreational amenities—rather than the allure of the golden visa. This sentiment is echoed by Engel & Völkers, another prominent luxury real estate firm operating in Spain, which anticipates negligible ramifications, citing that golden visa transactions constituted a mere 2% of their total transactions in 2023.
Impact on property prices in Spain
François Carriere Pastor, CEO of Coldwell Banker Spain, characterizes the elimination of the golden visa as a protectionist stance, suggesting it sends a discouraging signal to international investors. However, he anticipates no discernible impact on property prices in Spain, attributing the market's challenges more to supply constraints than visa-related factors. Similarly, Uxban, a real estate firm founded by Gonzalo Robles, predicts minimal repercussions on luxury housing prices, emphasizing sustained demand as the driving force behind price escalation.
End of the Golden Visa - Conclusion
The consensus within the luxury real estate sector aligns with broader industry perspectives. Notably, Barnes underscores that the golden visa has played a marginal role in their operations, with only a fraction of their clientele availing of the scheme. Enrique López Granados, President of Caledonian, views the golden visa as a contributor to wealth influx, citing examples of affluent clients whose investments have augmented economic activity without significant impact on housing prices.
In sum, while the golden visa program's termination may seem consequential, its actual influence on the Spanish real estate market appears muted, with underlying demand dynamics and supply-side challenges exerting more substantial effects.
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