Spanish Golden Visa – Madrid, Coasts, Islands, News and Analysis
The Spain Golden Visa
Acquiring residency in Spain for non-EU citizens has become easier from 2013 thanks to the Spanish Golden Visa. The only requirement is to invest 500,000 EUR in the real estate market. There is no obligation to live in the country. Clearly, this makes logistics easier for international business people and their families.
Amongst Golden Visa investors, Russians and Chinese make up 60%, roughly 30+% each. 10+% of the investors are from the Middle East (Saudi, Lebanese, Egyptians, Iranians, GCC). Followed by Ukrainians, Venezuelans and US citizens.
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Spain Real Estate Past and Present
Spain faced a ten year real estate downturn where no buyers or new construction existed. Market dynamics have drastically changed. The market recovery happening in the past few years has given rise to the opportunity for international investors to regain trust.
Taking a flight over to scout out properties no longer seems like a farfetched idea. Globalization has obviously contributed to the ease of communication between buyer and seller. American funds nowadays are behind many Spanish real estate developments. Price appreciation sees a 5-7% increase per year and supply is limited.
Location, location, location:
Taking into consideration that there are approximately 46 million residents in Spain, the center of the country is almost uninhabited. Most live on the Mediterranean coasts or in the capital, Madrid.
Madrid Market in the Region and in the Capital:
Madrid has little or no stock of completed properties, especially within the highway m30.
Over the last 4 years, the market sharply shifted from a re-sale market to a new developments one in both the wider Madrid Region and in the City of Madrid. In 2014, there was no new construction in Madrid City. But between 2015 and 2016, 1710 new apartments were put on sale.
The boom happening in the last two years saw an increase of 143% in new apartments. Of the current real estate on the market in Madrid City only 2% are re-sales. At present, 92.5% of the properties for sale in the Region of Madrid are off-plan (majority) or under construction and similar figures apply in Madrid City.
Aside from the coastal areas in Spain (especially Blanca and Del Sol), Balearic and the Canary Islands, tourist destinations help to attract capital. Barcelona being a Tech city aims to attract more foreign capital from tech companies. However, people are keeping an eye out on the political instability occurring in Cataluña, practicing a wait and see approach.
Who are the buyers?
Once Spain attracted mostly British buyers as a retirement alternative to East England. Other nationalities started buying in the last few years. Sales in 2017 confirmed that British investors with 9,156 sales were the most active in Spain, followed by French, German, Belgian and Swedish buyers.
Amongst the emerging markets, there is a marked year-on-year growth from Moroccan, Ecuadorian, Portuguese, Chinese and Russian buyers. The top 5 nationalities for purchase price are Ecuador, Portugal, Romania, Morocco and USA.
Latin-Americans also invest in Madrid (particularly from Venezuela and Mexico) pushed by economic and social crisis, limited business opportunities and lack of security in their countries.
Pleasant climate and scenery, friendly locals, good quality of life, a culturally interesting place to live, better environmental health, higher life expectancy and conducive retirement factors are many of the reasons propelling investors to real estate in Spain.
Requirements for buyers looking for new homes include attractive landscape design, good lighting, a view, the “lifestyle factor” and possibly “Alta Rentabilidad.”
The Golden Visa was signed into Spanish law and then approved by the Congress of Deputies and signed by King Juan Carlos I. It came into operation on September 27, 2013.