Spain is ending its "golden visa" program in exchange for real estate purchases.

The Spanish government has decided to stop issuing residence permits to foreigners who purchase real estate worth 500,000 euros or more, known as "golden visas." This announcement was made earlier this week by the Prime Minister of Spain, Pedro Sánchez. The decision was approved at a Cabinet meeting held on Tuesday, and now it remains to pass a bill that will allow this measure to be implemented.

Since the introduction of the "golden visa" program in 2013, Spain has issued 14,576 residence permits for foreign investors, according to Spanish Minister of Housing Isabel Rodriguez, citing data from the EFE news agency. Of this number, 94% are related to visas granted in exchange for investments in real estate. The highest number of investments has been made in cities such as Barcelona, Madrid, Malaga, Alicante, the Balearic Islands, and Valencia, and this has been happening for over ten years.

The total volume of investments in real estate since 2016 has amounted to about 10 billion euros, although the minister did not provide data for the entire duration of the program.

Although the specific reasons for the increase in demand for these visas in recent years are not specified, it is worth noting that this process coincides with changes that were introduced in Portugal as part of its "golden visa" program. It is important to remember that in 2022, the government of António Costa implemented new rules for issuing these permits to focus the program on the country's interior regions, particularly in the area of real estate investments.

In the future, in 2023, as part of the legislative package aimed at improving housing, the previous government decided to completely abolish "golden visas" related to real estate investments and capital transfers, leaving the program only for categories related to job creation and investments in scientific research or company capitalization.

Now Spain also plans to complete the residency permit program for those who invest in real estate, recognizing the impact this mechanism has already had on the housing market.Investments of this kind put pressure on the market, contribute to rising housing prices, and by eliminating them, we can mitigate and stop this kind of speculation.“,” said Isabel Rodriguez at the press conference that followed the Cabinet meeting. However, there is currently no specific date for when the cancellation of this regime will take effect.