Spain waves goodbye to the Golden Visa, prime minister Pedro Sánchez announced yesterday. The move comes after spiralling housing costs and a backlash against “expats”, with protests across Spain and the Canaries. By Eugene Costello
Spain waves goodbye to the Golden Visa, prime minister Pedro Sánchez announced yesterday. The move comes against spiralling housing costs and a backlash against “expats”, with protests across Spain and the Canaries.
The scheme allowed non-EU nationals to achieve residency by investing a minimum of £500,000 in either property or a business in Spain. The Socialist Party leader and prime minister, who relies upon support from hard-left and separatist parties to shore up his coalition, said yesterday in Seville that he would end the scheme “immediately”.
The scrapping of the exemption will allow his government to fight against “speculative investment” in property, he said, which is preventing “many young people and families” from accessing housing. He added “We will take the necessary measures to ensure that housing is a right and not just a speculative business”.
“Guiris go home”
The move comes against a rising background of anti-incomer sentiment. Here in Valencia, it is common to see graffiti with slogans such as “Vuestra alegría, nuestra misería” (your happiness, our misery). And in the Canaries, it is reaching feverish proportions, with mass protests against tourists and so-called “expats”. Groups such as “Canarias se exhausta” (the Canaries are exhausted or have had enough) have sprung up, driving anti-tourism activism. ‘It is time to boycott, with the tools at our disposal, the tourist activity that is expelling us from our own land,’ members have written on social media. More bluntly, slogans daubed around the islands say “Guiris, go home”.
Whether these anti-tourism initiatives play any part in the decision to withdraw the Golden Visa scheme as a populist measure is hard to say. What is known is that over the past three or four years, Valencia has seen property prices rise by 50% or more. It’s an emotive subject in expat social media groups, often with those who bought in the past defending the rises. And those who did not decrying it.
Spain waves goodbye to the Golden Visa
Spain brought the scheme in back in 2013 when the country was struggling and keen to introduce foreign capital. The Times of London points out “Portugal and Ireland scrapped similar schemes last year. All three countries have previously suffered from property bubbles bursting.”
It adds that over the past decade, these schemes have been snapped up by Russian and Chinese investors. The European Commission has been critical, pointing to worries over money-laundering and tax evasion.
With regard to take-up by British investors since Brexit, the problem is arguably greater in perception than in reality. Only 185 such schemes for the British have been approved since Brexit came into full force in 2021. While we are yet to see how and where the abolition will apply, Sánchez points to problems in larger cities where competition for property is fiercest. These include Valencia. Though whether that has anything to do with Golden Visas is a moot point. Golden visas applied to a total of 635 homes worth more than €500,000, a relative drop in the ocean.
Says Sánchez, “Today, 94 out of every hundred visas of this nature relate to property investment concentrated in large cities,” such as Barcelona, Madrid, Malaga, Alicante, Valencia or Palma de Mallorca. This stress is causing “a lot of tension in the housing market, making it nearly impossible for those living, working and paying taxes there to find decent housing.”
He added: “This is not the model of a country that we need, one of speculative investment in housing. It is a model that leads us to disaster and above all to lacerating inequality.”
A “European disgrace”
The culture minister Ernest Urtasun, spokesman for the radical left-wing party Sumar, called the visas “a European disgrace. You can’t grant someone a residency permit just because they’re a millionaire.”
The Daily Mail says “For Britons, Spain has long been a favoured destination in Europe. It had around 303,000 residing there in 2020. This is second only to those in Ireland at 305,000 and ahead of France at 170,000 and Germany at 118,000.
“The golden visa scheme offered a potential loophole for those with holiday homes in Spain to bypass EU stay limits. The removal of these visa schemes will add pressure on British expats increasingly reliant on these avenues post-Brexit.”
The abolition will be effective immediately, says Sánchez. Many believe that property prices will continue to rise, at least for now. Valencia’s City council has announced a raft of projects for the next decade, improving infrastructure and barrios in the city. The property bubble shows no sign of bursting just yet, say insiders.