Portuguese Prime Minister António Costa on February 16th announced that as a means of tackling the increasing lack of affordable housing in the country, his government will no longer offer residency to foreign property buyers or other investors through so-called golden visas.

Furthermore, Portuguese authorities will not grant new licences for short-term tourism rentals either, except in rural areas suffering from depopulation. 

Any third-country national wishing to renew their pre-existing golden visa will have to prove that their Portuguese property is being rented out on a permanent long-term basis, rather than as a holiday home.

These drastic measures come 11 years after Portugal’s golden visa was first introduced, with 11,535 residency authorisations issued and €6.7 billion in foreign investment. 

Back in 2012, there was a need for such a scheme to exist and it had largely met its objectives, Portuguese government officials have said.

But “the fight against price speculation in real estate” takes precedence now for Costa, who denied he was “killing the goose that laid the golden eggs” when referring to the tourism industry. 

Portugal has toughened its golden visa rules since 2020, making the financial requirements higher and preventing foreign property purchases in Lisbon and other areas where locals were being priced out by wealthy foreigners. 

Now they have taken the decision to fully scrap it, with the news coming just a day after the Irish government announced it would also axe its own golden visa scheme, citing internal and external reviews which recommended doing so. 

These decisions come after years of warnings by the EU that such foreign investment residency deals were a risk to security, transparency and the bloc’s values. 

This has been highlighted by the joint ban of golden visa applications by Russian tycoons looking to flee to Europe following their country’s invasion of Ukraine. 

So how about Spain and its golden visa? Is it also at risk of being scrapped?

On February 14th, Spanish political party Más País lodged a legal proposal at the Spanish Parliament calling for Spain’s golden visa scheme to also be abandoned. 

Their spokesperson Íñigo Errejón voiced the same reasons as those given by Portugal’s government – put an end to – or at least lessen – property speculation in Spain. 

“They’re driving up prices and kicking residents out of their neighbourhoods,” Errejón said of the influence of second homes on Spain’s property market.

For the former Unidas Podemos politician, these residency permits distort the market and don’t benefit the national economy.

It’s worth noting that Más País does not have much political clout in the Spanish Parliament, with only 3 seats out of 350, but could the tides be changing for wealthy foreign property buyers in España?

Spain is already one of only a few countries in the world that has a wealth tax for both residents and non-residents, and a new ‘solidarity tax’ for millionaires was also introduced in 2023. 

In recent weeks, regional governments in Spain’s two archipelagos – the Canary and Balearic Islands – have both announced that they were considering whether they should limit the sale of properties to non-residents as a means of quashing spiralling rents and property prices, something Canada has just decided to do.

The same proposal has been voiced by Podemos’s Alejandra Jacinto in Madrid.

Property prices are indeed on the up across Spain’s most popular spots, and in cities such as Málaga, there are now more tourist rental properties in the city centre than there are actual residents. 

Needless to say, rents in the southern city are up by 25.8 percent in 2023 compared to the previous year and property prices by 15.5 percent, as a result in large part of the proliferation of more profitable tourism rentals. 

It’s an election year in Spain and access to housing is one of the main concerns among Spain’s 48 million inhabitants. 

Spain’s ruling left-wing coalition government is yet to comment on whether it intends to change anything regarding Spain’s golden visa scheme, but there is increasing pressure at a regional and national level to ensure that residents in Spain can afford a home. 

Therefore, anyone considering getting a Spanish golden visa would do well to apply sooner rather than later if they want to be on the safe side.

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