In a move that has sent shockwaves through the expatriate community, Spain’s Prime Minister Pedro Sanchez announced plans to terminate the country’s ‘golden visa’ scheme, a decision poised to significantly impact hundreds of thousands of British expats and potential property buyers. The scheme, which has been a magnet for non-EU nationals seeking Spanish residency through property investment, is set for abolition as the government shifts focus towards ensuring affordable housing for its citizens.
Since its inception in 2013, the golden visa program has allowed individuals investing a minimum of £429,000 in Spanish real estate to secure residency rights for three years, with the option for renewal. This policy aimed at revitalizing the Spanish economy post-financial crisis by attracting affluent foreign investors has, however, come under scrutiny. Critics argue it exacerbates housing market pressures in major cities and opens doors to speculative business practices at the expense of local housing affordability.
Spain’s decision mirrors a growing trend among European nations reevaluating residency schemes targeting wealthy foreigners. Portugal recently concluded its non-habitual resident (NHR) visa scheme, which similarly facilitated tax incentives for foreign residents.
The announcement has unsettled the British expat community in Spain, which numbers around 303,000, making it one of the most popular destinations for British nationals within Europe. The golden visa has served as a critical pathway for those looking to secure residency, especially in the wake of Brexit, which has imposed new restrictions on UK citizens living in or moving to EU countries.
Real estate professionals and expats alike have expressed concern over the announcement, describing it as a significant blow to Britons’ aspirations for Spanish residency. The decision is expected to tighten the noose on British expats, who will now have to navigate stricter residency criteria and potentially adverse tax implications.
Spain’s government defends the move as a necessary step towards addressing the housing crisis in urban centres and ensuring that housing remains accessible to Spanish citizens who live and work in these areas. Prime Minister Sanchez emphasized the government’s commitment to prioritizing the needs of Spaniards over foreign investment in the property market.
As Spain prepares to phase out the golden visa scheme, the future for many British expats and prospective property buyers in Spain hangs in the balance. With the policy change, Spain joins a list of countries recalibrating their approach to foreign investment in real estate, signalling a broader shift towards more restrictive residency and property ownership rules for non-nationals.
