The legislation, popularly known as the “Golden Visa Act”, gives foreign investors the right to free movement and residence within the EU
On 30th September 2013 the Spanish legal gazette – the Boletin Official del Estado (BOE) – announced the eagerly anticipated new Act for foreign investors. As of now, non-EU citizens who make a minimum investment of € 500,000 in Spain, for example in real estate, may apply for a so-called investor visa that is valid for one year. During this period, the investor is not required to meet any minimum stay requirements in Spain – he can retain his main residence, and thus also his tax domicile, in his home country.
A house beside the sea as a ticket to the EU: with immediate effect, foreign investors who purchase a Spanish property with a value of € 500,000 or more also acquire the right to free movement and residence in Spain and throughout the entire EU.
After the first year, individuals may apply for a 2-year residence permit in Spain which can be extended without difficulty, provided that the value of the investment remains at € 500,000. During this period, however, the investor is entitled to sell the first property and acquire a new one, provided that this new property also has a minimum value of € 500,000.
After an uninterrupted 5-year period of residence in Spain, the investor may apply for a permanent residence permit. Five years after that, the individual even acquires the right to Spanish citizenship.
The Spanish state is hoping that this new legislation will stimulate the domestic real estate market and the economy in general. Experts however assume that foreign investors are less likely to invest in the fragile economy or fill the vacancies left in the wake of the property market crisis, but will tend to invest in already sought-after real estate locations such as Majorca, Ibiza or Marbella.
This is a truly interesting proposal for international investors who wish to invest in EU real estate. Those who buy a property in Majorca will receive not only an attractive capital investment for their money, but will also benefit from the right to EU-wide movement and residence since, because of the Schengen Agreement, such rights are not restricted to Spain alone. As a matter of interest, the Act applies not only to the property buyer as an individual, but also to spouses and children.
*This article does not purport to be legal advice but serves only to provide general information.*