For wealthy individuals, another residence in another country is a good investment particularly at this time when the freedom of movement has been curtailed by the Covid-19 global pandemic or unforeseen and uncertain political and economic situations. It can also be an opportunity to explore or expand your business or for your child to avail of an excellent education in another country. A good option to obtain a new residence is to make a real estate investment.
State of the spanish real estate market
The real estate market in Spain has been badly battered by the Covid-19 pandemic. But as the Chinese proverb says, “In every crisis there is opportunity” and this is the perfect time to avail of a residence-by-investment visa in Spain.
According to Reuters article dated March 3, 2021, investors are confident that the real estate market will weather the corona virus pandemic, even believing that real estate returns will do better than equities and bonds.
Property continues to be a good hedge against inflation which is expected to rise in the next few years thanks to the stimulus campaigns of many governments and central banks to help their citizens through the economic crisis brought about by the pandemic. Interest rates are still quite low and real estate offers better returns than most investment products.
In Madrid, price levels have fallen by about 5% especially for second-hand homes. Income from short-term and vacation rentals have all but disappeared. The good news is that these properties can be re-listed as long-term leases according to market demand. Spanish real estate were up in 2021 and the forecast is that prices will continue to rise by at least 2%. This is expected to be higher in popular areas such as the Costa del Sol.
Demand for residential property rather than office or warehouse space has soared particularly in the suburbs and rural areas. Interest in newer, larger properties with more green spaces has increased especially among foreigners.
A wide range of properties can be bought for €500,000 – from 3 bedroom apartments or townhouses to a fully detached villa with a garden – in secondary locations. An additional €1,000,000 or more may be needed for prime locations such a Madrid or Marbella.
Real Estate properties
There are several types of real estate property in Spain that are very Spanish in layout and style such as a chalet surrounded by nature with a large garden, swimming pool and parking area that will bring the owner tranquility and pleasure. There are also mansions in the mountains that are one or two storied located in strictly residential areas and upscale neighborhoods with swimming pool, terraces and views of the city and the Mediterranean Sea. Living in front of the sea is also an option and one can avail of at least 500 square meters of open space, light-filled interiors that is perfect for a very relaxed lifestyle.
The most expensive places to buy in Spain are Marbella, San Sebastian, Barcelona and Madrid. Less expensive are The Canary Islands, Catalunia, Andalucia and Valencia. In Castilla y Leon your €500,000 can go a long way.
There are also several amenities that come with the Golden Visa real estate purchase. The holder can avail of some amenities like resort-style living, world-class restaurants, concierge services, resident-only social clubs and fitness facilities.
Some Positive Things About Buying Real Estate in Spain:
- Real estate prices in Spain are low compared to other European countries but rental yields are on the high side.
- Spain is experiencing an economic growth along with the rest of Europe.
- Spain has 320 days of sun per year.
- Spain has the second longest coastal line in south Europe.
- Spain has a very stable political environment.
- Living standards, health care and work life balance have been ranked as one of the best in the world.
- The cost of living in Spain is much lower than European averages.
- Spain can boast of modern and efficient infrastructure.
- Spain is the country most visited by tourists in Europe that can translate to profitable rentals.
- Buyers of real estate can count on low construction costs should they need to build or renovate.
Golden Visa Spain
The residence permit by investment program or the Golden Visa Spain is the best option for high-net worth individuals and their families who are from non-European Union countries.
The Golden Visa Spain has the following requirements:
- A minimum investment of €500,000 in real estate
- The Golden Visa Spain is a temporary residency permit that can be renewed every two years. It is not necessary to live in Spain in order to retain and renew the residency visa permit.
- Upon the fifth year of the residency visa permit, the applicant can now apply for permanent residency.
The Golden Visa Spain has several investment options:
- minimum investment €500,000 in real estate
- €2,000,000 capital investment in Spanish Public debt or;
- €1,000,000 investment in shares in an existing Spanish company with real activity or;
- €1,000,000 deposit in a reputable Spanish bank or fund or
Benefits of Spanish Golden Visa:
- The right to live in Spain, a member of the European Union
- Visa-free travel throughout the European Union
- Visa-free travel to 185 countries
- Available for you and your family
- No minimum stay requirements