Inside a Spanish island, where properties are purchased by wealthy American buyers: Prices in...

Experts say that Americans seeking a better quality of life are moving en masse to Spain, which is driving up housing prices in this European country.

According to Spanish notary records, U.S. buyers purchased 1,162 residential properties in the first half of 2022, up 76 percent from the same time a year earlier.

However, this trend, which is being driven by wealthy families and retirees tired of the economic turmoil in the U.S., is causing inflation in the real estate market for locals.

The problem particularly affects the Balearic Islands, particularly Mallorca, where prices rose 15 percent in the year to June 2023, according to real estate agency Savills.

Rents in the island's capital, Palma, have also risen 75 percent over the past decade, according to Spanish real estate website Idealista.

The island's wealthiest neighborhoods are experiencing the biggest price increases, Savills data shows.

The average price in the port of Andraxt in Mallorca rose from €4.5 million to around €5 million between 2021 and 2022.

As a result, about 36 percent of properties sold in Mallorca and neighboring islands are purchased by foreigners rather than locals, according to the Colegio de Registradores.

Experts say Americans are moving to Europe partly out of frustration with everything going on back home.

Gloriana Bonillo of real estate agency VDB Luxury Properties recently told the New York Post, "I don't know what kind of memo has been sent out in the U.S. over the last four years, but we've noticed a huge difference in the behavior of Americans starting in 2019."

As she pointed out, they mostly come from New York, Los Angeles, Texas and really want to leave the U.S.

She added that factors leading to this decision include unsustainable costs, such as a costly health care system and education problems, among others.

Additionally, Spain is attractive to expats due to its new flexible visa issuance rules.

This year, the country launched a "digital nomad visa" program that makes it easier for remote workers to live and work.

Applicants must meet a specific set of requirements, such as having at least three years of professional experience and a salary of at least €2334 per month.

Expats can also obtain a "golden visa," which is automatically granted upon purchasing real estate worth over €500,000.

Applicants can also qualify for a visa if they purchase shares in a company, deposit at least $1.1 million in a Spanish bank, or invest at least $2.2 million in Spanish government bonds.

Spain is attractive to expats because its government has taken stricter measures to combat inflation compared to the USA and even its European neighbors.

In addition, the country has introduced flexible new rules for issuing visas to expats.

Foreign buyers can also obtain an automatic "golden visa" when purchasing real estate worth over €500,000.

The initial permit is valid for one year, but it can be replaced with Spanish residency, which is valid for another two years.

It can be extended indefinitely if the expat maintains their investments.

Retirees can also apply for a "retirement visa in Spain," which allows them to reside in the country with a minimum of €33,000 in a bank account, private health insurance, and a clean criminal record.

Realtor Connor Wild, CEO and founder of Found Valencia Property, noted that Americans are increasingly interested in the "Spanish way of life."

He told the Wall Street Journal: "American buyers come to us every week. I've never seen anything like it."

He added that most Americans want to move there permanently, and many come with school-aged children.

Residents of the USA who wish to move to Spain should also be aware of the tax implications of such a move.

If they want to buy property in this European country, they will have to pay a tax upfront in the form of the so-called "stamp duty."

This can range from one to 2.5 percent and must be paid by the buyer within 30 business days after the change of ownership of the property.

However, after paying this amount, the owners do not need to worry about property tax. This is different from the system in the USA, where property tax is charged annually.