Spain's Congress has approved a bill to eliminate real estate investment from the Golden Visa Program, targeting a January 2025 start date. The move aims to curb speculative property buying in highly sought-after areas while keeping other investment pathways open.
Spain is set to end the real estate investment option under its Golden Visa Program, a significant move aimed at addressing the country’s housing crisis.
A Step Towards Housing Affordability
The Congress of Deputies in Spain approved a bill on November 14, 2024, that will likely phase out the real estate investment route by January 2025.
This decision comes after Prime Minister Pedro Sanchez expressed concerns about the program’s contribution to rising housing prices in major cities like Madrid, Barcelona, Malaga, and Valencia.
Bill Still Awaits Final Approval
Although Congress has approved the initial changes, the proposed bill will now move to the Senate for possible revisions. Once reviewed, it will return to Congress for a final vote before officially removing real estate investments from the program. If passed, the new rules are expected to take effect early next year.
Spain’s Golden Visa: Real Estate Investment in Focus
Spain’s Golden Visa Program has long attracted non-EU nationals by offering residency through various investment avenues. Options include:
• Real Estate Investment
• Business Development
• Capital Transfer
The real estate route, in particular, has been a popular choice among wealthy international investors. This option allowed foreign nationals to secure residency by purchasing properties worth at least €500,000, alongside fulfilling other specified conditions.
Housing Market Concerns Prompt Changes
In 2024, Prime Minister Pedro Sánchez raised concerns about the impact of real estate investments on Spain’s housing market. He noted that 94% of Golden Visas were linked to property purchases in high-demand areas like Madrid and Barcelona, leading to “stressed” housing conditions.
To address this, Sánchez announced plans to end the real estate investment option, aiming to reduce speculative buying. The decision was made official in April, with the goal of making housing more accessible to local residents.
Economic Impact of the Golden Visa Program
Spain’s Golden Visa Program has significantly boosted the economy, particularly through real estate investments;
• In 2022, 2,462 visas were granted for property purchases exceeding €500,000.
• This figure represents a 60% increase compared to 2021.
• Since 2013, over 11,464 investors have secured residency through the Golden Visa Program.
The removal of the real estate investment option may shift investor interest to other areas, such as business development and capital transfers.
What’s Next for the Golden Visa Program?
If the bill passes, the real estate route may end in January 2025, pushing investors to explore other options. Investments in business ventures an capital remain viable under the current rules. Spain’s ongoing review aims to balance economic benefits with local housing needs, keeping the property market more accessible to residents.
Conclusion
Spain’s decision to end real estate investments under the Golden Visa highlights concerns over housing affordability. Investors should follow legislative updates and explore other residency options. The policy shift may reshape the program towards more sustainable and fair contributions from international investors.
Source: https://travelobiz.com/spain-to-end-real-estate-investment-for-golden-visa-by-january-2025/
