In recent weeks, the ending of the “Golden Visa” (Investor Residency) in Spain has sparked intense debate, particularly regarding its impact on the property market and concerns about housing security and accessibility. This measure was initially included in Bill 121/000018, which focuses on creating an Administrative Authority for the Protection of Financial Consumers, and Amendment No. 316 of Organic Bill 121/000016, which aims to improve the efficiency of the judicial system and protect consumer rights.

Written for Expat Network by Mª Eugenia Blasco Rodellar, AGM Abogados

This proposal has been finally approved and published in the BOE (Official State Gazette) on 3 January, BOE-A- 2025-76, Organic Law 1/2025, of 2 January, on measures regarding the efficiency of the Public Justice Service. This brings an end to the uncertainty among foreign investors and current holders of these permits, while key questions arise about their future and the available alternatives for residing or investing in Spain.

Current status of the Golden Visa in Spain

On 3 January, Organic Law 1/2025, of 2 January, on measures to improve the efficiency of the Public Justice Service, was finally published. In its twenty-first final provision, it introduces an amendment to Law 14/2013, of 27 September, on support for entrepreneurs and their internationalisation, which eliminates investor visas. This measure will come into effect three months later, on 3 April 2025, and all investor visas will be abolished, as the Law provides for the repeal of Articles 63 to 67 of Law 14/2013, which have so far governed the residence regime for foreigners making significant investments in the country.

What is Spain’s Golden Visa scheme, and what was its main purpose?

Spain’s “Golden Visa” scheme was first introduced in 2013. It was originally designed to attract foreign investment in a period of economic crisis, incentivising the acquisition of real estate and other assets such as public debt, investment funds, or investments in Spanish companies or projects of general interest.

Reasons for Spain’s decision to end the Golden Visa scheme for foreign investors

The abolition of the Golden Visa is attributed to several reasons, according to the proponents of this measure. Below are the main motivations:

Negative impact on the Spanish Real Estate market:

The elimination of this scheme responds, in part, to the significant increase in property purchases by foreign investors, which has had a notable impact on the Spanish property market, particularly in specific areas. This trend has driven up housing prices and, in some cases, led to gentrification, making it more difficult for local residents to access affordable housing.

Questionable Economic Effectiveness:

According to the text of the amendment, it is noted that other forms of investment linked to this regime have not had a significant impact on the economy, leading to questions about its effectiveness as a tool for attracting foreign capital. This last reason has been a key factor in the elimination of all investor visas, not just those for real estate investment, as originally planned. Although it is true that the other investment channels have not been widely used, it is possible that their use could increase once they become the only option.

Limited residency options for non-EU nationals:

Spain offers other residency options for those who do not wish to reside permanently and become tax residents in the country but do not want to be restricted by the maximum tourist stay limits. These include non-profit residency or residency as a “digital nomad”, although all of these require spending more than six months in the country each year.

Security concerns:

The measure also refers to a broader trend at the European level to review or tighten investment visa programmes. Since the Russian invasion of Ukraine, several European Union (EU) countries have begun to restrict such permits due to security and transparency concerns, particularly regarding the origin of funds.

Treatment of ongoing applications: What will happen to current Golden Visas and applications in process.

The new regulations includes transitional provisions to protect vested rights. Specifically:

• Applications in process: applications submitted before the law comes into effect, that is, prior to 2 April 2025, may continue the process of obtaining a visa or authorisation in accordance with the regulations in force at the time of application. It is essential to note that the investment must already be completed to initiate the process, and for real estate investments, the property must be duly registered in the Land Registry. Since the processes of purchase, sale, and registration can take up to two months, it is critical that the visa or residency process is initiated before the new regulations come into force -not solely the investment process.

• Renewal of existing visas: visas and authorisations already issued will remain valid until their expiration date, with renewals processed according to the regulations in place at the time of the original issuance. However, it is crucial to manage these renewals carefully and seek appropriate guidance, as any issues or refusal to renew would preclude the possibility of reapplying for an investor visa or residency.

The elimination of the investment residence visa marks a significant shift in Spain’s immigration and economic policy. This measure aims to mitigate the negative impact on housing access and align with European concerns surrounding security and financial transparency.  For  current  and  prospective  investors,  this  amendment  implies  a reorientation: only those already in process or holding a current authorisation will be able to benefit.

Considering the time required to complete an investment, the countdown has now truly begun for those wishing to secure an investor residence in Spain.