Spain has started issuing residency permits to non-EU nationals in return for real estate investments of €500,000 ($670,000) or more, almost five months after introducing a law to this effect. A businesswoman from Shanghai became one of the first foreign investors to receive this residency permit after she invested €520,000 to buy flats in Barcelona and Madrid.

Spain is one of the several European countries to have introduced schemes by which residency permits are granted to wealthy foreign real estate investors, in return for buying prime properties. Other countries are Portugal, Greece, Hungry, and Cyprus

These residency permits aim to bolster ailing European countries, increase employment and boost real estate.

The investor has to retain the property in order to continue enjoying residency benefits. In Spain and Portugal, the minimum investment is €500,000 ($670,000).

In Portugal, more than 330 visas were issued within one year of the scheme’s launch, fetching €225 million. In the first three weeks of January, 2014, Portugal granted a total of 49 fast-track golden visas and received investments of €27 million. Investors, mainly from China, Russia, Brazil, Angola, South Africa, and India, are applying for Golden Visas in Portugal, with Chinese topping the chart by a big margin.

Discontent with the current political set-up in China, the fall in real estate prices in Europe and the depreciation of the euro are some reasons behind growing Chinese interest in European property.

Mainland Chinese investment in Europe tripled last year as insurers, developers and private individuals joined the country’s sovereign wealth funds in seeking to diversify their assets outside Asia, according to research firm Real Capital Analytics (RCA).

With €500,000 for a property, a foreigner can now be a resident of Spain and can even get a Schengen-area access*. Thanks to the new Golden Visa legislation approved by the Spanish Congress recently.

After the legislation’s passage in the Spanish Congress and Senate and publication in the official gazette the BOE (BoletinOficialdel Estado) these past few days, Spain wants to prove that it is better late than never.

Spain joins neighbouring European countries Portugal, Cyprus, Malta and Greece, which had earlier approved similar laws, but with lower price ceilings for properties to be acquired to gain a residency visa.

THE KEY TO ACCESS EUROPE – Family and mobility benefits in Europe

Travel freely, without a visa, to the Europe Schengen Area. The holders of a Spanish Residence Permit (Golden Visa) will not require a visa to enter the Europe Schengen Area. They can transit and enjoy free movement in the Schengen Area for a maximum period of 3 months (90 days) per half-year form the date of first entry.
Other countries which do not belong to the Schengen Area but which guarantee the free movement of persons are: Andorra (required to show passport together with the visa or residence permit), Monaco, San Marino and the Vatican City.

Visas and residence permits apply to both the spouse of the applicant and their children under 18.

I would like to invest in Spain, but I don’t know about the Legal or Tax aspects related

Bahia Dorada collaborates with firms of independent Spanish lawyers with both knowledge and experience in foreign investment by individuals or companies.

Bahia Dorada safely guarantees that these firms will provide the best legal and tax assistance to solve every aspect and all the paper work required during the entire process of the property or financial investment.

Frequently Asked Questions for Visas and Residence Permits in Spain through Property investment

In the case of investing in property, must the property be free of mortgage? [+]

Not necessarily, as long as the contribution of private funds is over 500,000 €. This means you can buy a property with a mortgage as long as the difference between the purchase price and the mortgage is over 500.000 €.

It may be the case you purchase a property that does not have an existing mortgage. If this is the case, as the future buyer you can take out a loan and mortgage the property yourself, as long as this still results a personal investment of 500.000 e in addition to any loan.

Does having a Spanish residence permit entitles me to healthcare in Spain too? [+]

The granting of a visa or a residence permit does not entitle social or health benefits.

You will need to have private health insurance in order to receive the benefits without being subject to higher charges.

Can I transfer my money from anywhere in the world? [+]

Yes, but you should be able to provide evidence as to the source of funds to demonstrate that come from clean sources and are not involved in criminal or illegal activities.

Also, if the fund comes from a tax haven, a declaration procedure should be performed in advance in the “Register of Investors’, a specific department of the Ministry of Economy in Spain.