Blow for hundreds of thousands of British expats as Spain’s socialist PM reveals plans to end the ‘golden visa’ scheme that gives residency to property buyers from abroad: Experts say ‘it’s like a bomb has gone off’

Spain plans to end its ‘golden visa’ scheme which provides residency to property buyers from abroad.

In a blow to British expats eyeing Spanish shores, the Spanish prime minister Pedro Sanchez said the move aims to prioritise affordable housing for Spaniards instead of ‘speculative business’.

Currently, the programme permits non-EU citizens who invest a minimum of £429,000 in Spanish property to live and work in the country for three years.

Mr Sanchez said yesterday: ‘Today, 94 out of every 100 such visas are linked to real estate investment… in major cities like Barcelona, Madrid, Malaga, Alicante, Valencia or Palma de Mallorca that are facing a highly stressed market and where it’s almost impossible to find decent housing for those who already live, work and pay their taxes there.’

Spain’s decision follows Portugal’s move to end its similar non-habitual resident (NHR) visa scheme, which offered lucrative tax breaks to foreigners (stock photo)

Spanish prime minister Pedro Sanchez (pictured) said the move aims to prioritise affordable housing for Spaniards instead of ‘speculative business’ 

Introduced in 2013 to bolster the Spanish economy after the financial crisis – with wealthy foreigners encouraged to invest in real estate – the golden visa programme faced mounting criticism from the EU.

This prompted calls for its abolition because of concerns about price inflation and potential exploitation by criminals using it for money laundering. Spain’s decision follows Portugal’s move to end its similar non-habitual resident (NHR) visa scheme, which offered lucrative tax breaks to foreigners who spend more than six months a year in the country.

For Britons, Spain has long been a favoured destination in Europe, with around 303,000 residing in the country in 2020, second only to those in Ireland at 305,000 and ahead of France at 170,000 and Germany at 118,000.

The golden visa scheme offered a potential loophole for those with holiday homes in Spain to bypass EU stay limits. The removal of these visa schemes will add pressure on British expats increasingly reliant on these avenues post-Brexit.

While alternative routes to residency exist, they often come with more stringent criteria and tax implications. Under the current scheme, residency can be extended, and citizenship pursued after a decade of residency.

Mary Dunne, of estate agents Hamptons International, said: ‘It’s like a bomb went off this morning. It’s going to be a big issue for expats wanting to move and a lot of people are very unhappy about it. What’s being done isn’t hugely different from other European countries, but it’s not a positive message.’