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Spain to scrap golden visa for wealthy foreigners

Spanish Prime Minister Pedro Sánchez on Monday announced his plans to get rid of the golden visa scheme which grants non-EU nationals residency in Spain when they buy real estate worth €500,000. 

Published: 8 April 2024 14:38 CEST
Spain to scrap golden visa for wealthy foreigners
Spain's Prime Minister Pedro Sánchez plans to end the golden visa scheme that gave wealthy third country nationals residency rights in Spain if they bought a home in the country worth half a million euros. (Photo by OSCAR DEL POZO / AFP)

In the face of a housing crisis affecting millions of Spaniards but which has seen foreigners buy up homes in record numbers, Socialist Prime Minister has announced plans to scrap Spain’s visado de oro.

“We are going to begin the procedure to eliminate the granting of the so-called golden visa, which allows access to Spanish residency when more than half a million euros are invested in real estate,” Sánchez told journalists in Seville on Monday.

“We are going to take the necessary measures to guarantee that housing is a right and not a mere speculative business.” 

Access to the golden visa has also been open to those who invested €1 million in shares in Spanish companies, or €2 million in government bonds, or transferred €1 million to a Spanish bank account. 

Therefore, Spain’s golden visa has come to be known as one of the ‘easiest’ ways of gaining Spanish residency as a third country national, for those wealthy enough. 

Some of the other perks it has offered are that family members could be included on the visa, the option of not being a tax resident in Spain or having to live there, and freedom of movement around the Schengen Zone.

Since Spain’s golden visas came into force in 2013, more than 11,500 have been granted, along with another 20,000 authorisations for family reunification.

READ ALSO: What the end of Spain’s golden visa means for foreigners

However, these ‘wealth’ visa schemes have come under increasing scrutiny across Europe in recent years, seen as offering some criminals a gateway to life in Europe and allowing wealthy foreign property buyers to distort the real estate market.

The proportion of foreigners who bought properties in Spain in 2023 was higher than ever before, 15 percent of the total. 

There is also evidence that in recent years foreign buyers have been willing to splash out more and more on a Spanish home.

READ ALSO: When and why is Spain axing the golden visa?

According to Sánchez, 94 in every 100 golden visas issued were linked to properties bought in popular provincial capitals such as Barcelona, ​​Madrid, Málaga, Alicante, Valencia or Palma de Mallorca where property prices and rents have all risen exponentially.

The Netherlands, Portugal, Ireland, Greece and Malta have all either scrapped the equivalent of their golden visas or made the conditions much harder for millionaires who want to make a real estate investment.

Upon hearing the news, Spain’s hard-left Culture Minister Ernest Urtasun referred to the Spanish golden visa as a “European disgrace”, adding that “it cannot be that someone is given a residence permit for the fact of being rich; this is creating first and second-class citizens.”

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RENTING

Do I have to pay the estate agent a commission if I rent in Spain?

Who has to pay the real estate agent commission (usually equivalent to one month's rent) in Spain: the landlord or the new tenant? And are there exceptions to the rules or underhand tricks agents use to get tenants to cough up more money?

Published: 24 April 2024 10:16 CEST
Updated: 27 April 2024 15:03 CEST
Do I have to pay the estate agent a commission if I rent in Spain?

Up until 2023, the general rule in Spain was that both the landlord and the tenant would both have to pay estate agency fees when a rental contract was processed through them, although in some cases it was just the arrendatario (tenant) rather than the arrendador (landlord) who had to foot most of this commission.

Tenants often had the sense they weren’t getting much in return out of it, as it was common to find apartments hadn’t been cleaned, filled with broken furniture and other appliances that weren’t working.

On top of a commission to the agency equal to one month of rent, tenants had to pay one to two month’s deposit and a month’s rent, meaning they had to pay a total of three to four months’ worth of fees upfront, which would rack up to a lot of money. 

READ ALSO: The cities in Spain where people fight most over a place to rent 

Thankfully, Spain’s housing law, brought into force in May 2023, put an end to this and now it’s solely down to the landlord to pay the agency fee as they’re the ones who hired them.

The law, which modified part of the Urban Leasing Law of 1994, now states: “The expenses of real estate management and formalisation of the contract will be borne by the lessor,” that is, the owner of the property.

READ ALSO – Renting in Spain: Can my partner move in with me?

One of the main problems is that agencies have been doing this for so long that they stand to lose quite a bit of money and may continue to ask tenants to pay on the side. 

Alejandro Fuentes-Lojo, a lawyer specialised in real estate law explained to Spanish news site Newtral: “Many professionals will try to circumvent this prohibition, and in some cases they will try to make the tenant pay out of pocket, but we must warn that if they agree, they will be unprotected by the law”.

Be aware, even though tenants shouldn’t have to pay the full agency fees anymore, there are certain circumstances in which they may still have to pay something.

The Rental Negotiating Agency (ANA), states that there are a series of exceptional cases where real estate agencies can pass some of these expenses on to tenants, specifically when they are offered a series of additional services that directly benefit them.

These expenses could include house cleaning services at the end of the lease, repair services and legal advice during the duration of the contract, or other services where it can be proven that they have a direct benefit for the tenants. These expenses can only be collected after the contracts are signed.

READ ALSO – Q&A: When can you legally leave a rental property in Spain? 

The general director of ANA and a lawyer specialised in leasing, José Ramón Zurdo, states: “The new Housing Law does not regulate or limit the impact of expenses that accrue after the signing of the contracts, because the limit of expenses that can be passed on is closed after this time”.

According to the new housing law, expenses that can’t be passed on to the tenant include management expenses charged by real estate agencies for intermediating, searching for tenants and showing the homes. Tenants can also not be charged for expenses of formalising contracts or paying any lawyers or notaries involved.

There are also four exceptional cases where agencies can still charge fees to tenants, when they are not habitual residence leases and, therefore, are not regulated by the Urban Leases Law.

These include:

  • Tourist accommodation
  • Rental of commercial or office space
  • Seasonal rentals
  • Luxury housing leases – Properties whose surface area exceeds 300 m2 built, or whose rent exceeds the interprofessional minimum wage by 5.5 times.

READ ALSO: Spanish court rules buyer can purchase property directly from seller without paying agency fees

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