Property experts in Spain have insisted the scrapping of the Golden Visa scheme will have ‘very little impact’ on house prices or demand.
The programme, first launched in 2013, allowed people from outside the EU to become a resident in Spain if they spent €500,000 on real estate or made certain business investments.
According to Ministry of Housing statistics, the majority of applicants hailed from China, Russia, the UK, US, Ukraine, Iran, Venezuela and Mexico.
But last week, the scheme officially ceased to exist, 12 months after Prime Minister Pedro Sanchez first announced its demise, citing a need to reduce ‘speculation’ of the property market and lower prices.
But estate agents questioned how much getting rid of the scheme would free up homes for everyday Spaniards, given that the majority of families are not looking for homes worth half a million euros.
This week, experts said the only areas that will be impacted will be the tourist hotspots of Madrid, Barcelona, Malaga, Alicante, Valencia and the Balearic Islands, which accounted for 90% of Golden Visas granted between 2013 and 2023. Even so, they said the effects will be ‘minimal’ at best.
Simone Colombelli, Director of Mortgages at iAhorro, told Infobae: ‘The number of visas granted, especially in recent years, is so low that its elimination will have little effect on the country’s real estate market.
‘Although it will have a greater impact on some of Spain’s most stressed cities, the housing problem in these areas is that demand far exceeds supply, and eliminating the ‘golden visa’ doesn’t solve that.’
Iñaki Unsain, CEO of ACV Gestion Inmobiliaria, added: ‘The impact of this measure will be minimal on the market, since the ‘golden visa’ was simply an incentive that won’t deter those who want to purchase a property in our country…
‘It’s elimination will have no effect on housing demand at the price level.’
The latest available figures, from the year 2023, showed that 10.04% if all property sales were made by non
Home sales for golden visa applications are insignificant compared to those made by non-residents in Spain. According to data from the Ministry of Housing, in 2023, the last year for which definitive figures are available, a total of 622,820 home sales were recorded in Spain, of which 10.04% were held by a foreigner who was not a resident of our country (56,419). Only 3,273 of these citizens applied for the “golden visa,” representing 5.8% of the number of transactions carried out by non-resident foreigners and 0.53% of the total number of sales. This assumes that all visas granted that year were for housing investments. Therefore, “before the government announced its elimination, their granting was clearly in decline. Fewer visas of this type were granted each year, and those who were granted them were very specific individuals, with a specific purchasing power, who purchased homes in very specific areas of Spain,” says the Director of Mortgages at iAhorro. The expert emphasizes that, for this reason, “the elimination of this benefit is primarily a political measure, which will have a very limited impact on both home purchase prices and the reduction of real estate speculation.”
