Spain launched its Golden Visa scheme in October 2013, just a year after neighbouring Portugal launched a Golden Visa scheme as well. Spain’s Golden Visa, like that of Portugal’s, offers residency permits to non-EU citizens who invest at least 500,000 EUR in properties in Spain. So if you’re looking to sell overseas property quickly in Spain, you would no doubt be very eager to find out how the scheme has been received by wealthy international investors.
So far, the Spanish Golden Visa has performed below expectations. Less than 100 international investors have chosen to take advantage of the scheme despite Spain being the top overseas property destination in the world. This is surprising to say the least, because 500,000 EUR isn’t really much to a vast majority of wealthy international investors.
The Russian and Chinese investors, who have so far applied for the Golden Visa, have purchased Spanish properties worth over €700 million. While the numbers don’t look too bad, they can certainly be a lot better, considering that neighbouring Portugal has issued close to 3000 Golden Visas already, getting investments of almost €2 billion.
Alex Vaughan of the Barcelona based Lucas Fox explains that the performance of the Golden Visa scheme hasn’t been up to anyone’s expectations: "The numbers are comparable with Portugal in the first year of their Golden Visa programme but given the current interest in Spanish property we believe that these numbers should increase significantly for the scheme to be classed as a success."
He adds, "We are continuing to see interest, primarily from the Middle East and Asia. We continue to believe that, as in Portugal, the main interest will come from China, but the numbers of applicants have so far failed to materialize."
Wealthy Chinese investors were the principal targets for the scheme, but it turns out that they were put off by its complexity and by the fact that there were easier ways to obtain an EU residency elsewhere in Europe. The Spanish banks did not help matters by issuing strict new money-laundering laws.
Now, the Spanish government has been working hard to tweak the scheme and simplify some of the requirements. In particular, the government wants to make it easier for non-EU nationals to work in Spain, remove the restrictions on families and dependents, introduce a new scheme for visa renewal every five years automatically, issue a 6-month visa on the placement of a deposit and offer the option of applying for the residency permit in Spain itself, not just in the country of origin.
The new law aims to offer more security to foreign investors before they invest in Spain and apply for the Golden Visa, and allow them to stay longer. While the Spanish Golden Visa lags behind that offered by Portugal, the fact remains that there are no cases of massive corruption or illegal deals related to the Golden Visa in Spain as in Portugal. This should make the Spanish Golden Visa much more attractive in the long run than the one offered by Portugal.
However, don’t expect any big changes in 2016, as there is a lot of political uncertainty in Spain because of the complex results thrown by the General Elections held in December, 2015, which say three political parties get 20 percent of the votes and one get 15 percent.
This is a peculiar situation as we still don’t have a stable government in Spain, even though it’s been almost three months since the elections were concluded. So we expect there to be a policy paralysis in Spain and no major decision is likely to be taken in 2016 related to the Golden Visa. This is just unfortunate for all concerned.