Yesterday, Thursday 14 November 2024, the Spanish government voted to end the ‘Golden Visa’, a type of visa that grants residence permits to foreigners who make significant investments in the country. This measure has been included in the Law for the Efficiency of Justice, which already has parliamentary approval; however, permits may continue to be granted until the new rule comes into force. Once published, the law will have an implementation period of between 20 days and 3 months. However, the exact period for eliminating the investment visa is not clearly specified, which could extend the process by a few more months, at which point these permits will be completely eliminated for foreign investors.
What is the Golden Visa?
The Golden Visa allows non-EU citizens to reside in Spain if they invest at least 500,000 euros in real estate, more than two million euros in Spanish government bonds or more than one million euros in shares of active Spanish companies. Alternatively, this residence permit can be obtained through investments of more than one million euros in investment funds registered in Spain or in bank deposits in Spanish institutions, as well as through the creation of business projects in the country that are considered to be of general interest. This programme was created to attract foreign investment in times of economic crisis, encouraging the purchase of real estate and other assets to stimulate the Spanish economy. Since its launch in 2013, Spain has granted more than 14,000 Golden Visas, with Madrid, Barcelona and Malaga being the cities with the highest demand for these permits.
Reasons for the Elimination of the Golden Visa
The end of Golden Visas is due to several reasons. First, the increase in property purchases by foreigners has had a strong impact on the real estate market, especially in specific areas, increasing prices and contributing to gentrification, which has made access to housing more difficult for local residents. The amendment promoted by the Spanish Socialist Party and its parliamentary partners also points out that the economic impact of this regime has not been as significant as expected, questioning its effectiveness in attracting foreign capital. The need to limit these permits for security and transparency reasons, particularly in relation to the origin of the funds used for investments, has also been pointed out. Despite its elimination, those who have obtained residency in Spain through this programme will continue to be respected and valid.