What are 'golden visas' and which EU nations still offer them?
If you're considering relocating to Europe, a golden visa could be the gateway to residency. These residence-by-investment schemes allow wealthy individuals to obtain the right to live and work in a European country, often without the need to reside there permanently. As demand for golden visas grows, certain European countries are making significant changes to their policies.
Golden visas are offered by several European countries as a way for non-EU nationals to gain residency in exchange for a significant investment. The most common method for obtaining a golden visa is through purchasing property, although other investment opportunities, such as donations to national funds or starting businesses, are also valid routes. These programs have gained popularity, especially among individuals looking to escape political or economic instability, as well as those seeking greater access to the European Union (EU) for travel and work.
However, the popularity of golden visas has also led to increasing scrutiny. Many European countries are rethinking their policies, with several moving to either abolish or restrict the schemes. This trend highlights the evolving landscape of residence-by-investment programs in the EU.
The Golden Visa Landscape in Europe
Golden visas allow wealthy individuals to bypass some of the usual requirements for residency, offering them a quicker and more straightforward route to permanent status. The concept behind these schemes is simple: foreigners can purchase property or make other significant investments in the country to obtain residency, sometimes with little to no obligation to live there.
In the wake of global uncertainties, including Brexit and rising geopolitical tensions, European golden visa programs have seen a surge in applications. High-net-worth individuals, particularly from countries experiencing political unrest or economic instability, are increasingly looking at golden visas as an attractive option.
Spain Moves Toward Ending Its Golden Visa Program
Spain’s golden visa program, one of the most popular in Europe, has been in place since 2013. The program has allowed non-EU nationals to obtain residency by investing in real estate or certain types of business ventures, with the minimum investment typically set at €500,000. However, as of April 2024, Spain’s government has announced plans to end the real estate investment route, which constitutes a significant portion of the golden visa applications in the country.
The decision to phase out the real estate-based golden visa program comes in response to rising concerns about housing market pressure. The government, led by Prime Minister Pedro Sánchez, has expressed that it is committed to making housing a right, not a speculative asset. With the rising costs of housing in popular Spanish cities like Madrid and Barcelona, the golden visa program has faced growing criticism for contributing to the property bubble.
The Spanish government is finalizing the law under the "Law for the Efficiency of Justice," which will end the golden visa scheme by January 2025. This change could also extend to other investment pathways that have traditionally been part of the program, such as investing in companies, bank deposits, or government bonds. However, applications filed before the new law comes into effect are expected to be processed as usual.
Spain’s decision to end its golden visa program follows the example set by other European nations. It highlights a shift in the EU's approach to residence-by-investment schemes, driven in part by concerns over housing affordability and foreign ownership of local properties.
Hungary Reintroduces Its Golden Visa Scheme
While Spain and other countries like Portugal, the Netherlands, and the UK have taken steps to end their golden visa schemes, Hungary has bucked the trend by announcing plans to reintroduce its own program. The Hungarian Guest Investor Program (GIP), which was suspended in 2017, will reopen in July 2024.
The GIP will offer three distinct pathways to residency. Applicants can invest in real estate (with a minimum €500,000 investment), real estate investment funds (minimum €250,000), or donate at least €1 million to a higher educational institution in Hungary. Notably, this visa will extend to the applicant's spouse and dependent children, and it will grant visa-free travel within the Schengen zone.
Hungary’s decision to revive its golden visa scheme contrasts sharply with the actions of other EU countries. The Hungarian government argues that the program is an important tool to attract foreign investment and boost the country’s economy. Despite the growing criticism of golden visas, Hungary remains committed to its policy, aiming to create a competitive advantage by welcoming affluent international investors.
Portugal and the Netherlands End Their Golden Visa Programs
In late 2023, Portugal took a bold step in removing real estate investment as a valid pathway for obtaining a golden visa. This decision came amid concerns over rising property prices in the country, particularly in Lisbon and Porto. The Portuguese government’s primary goal is to reduce property speculation, making housing more accessible to local citizens. While the move has been controversial, it reflects the growing tension between the popularity of golden visas and the pressures placed on national housing markets.
The Netherlands followed suit in early 2024 by ending its golden visa program. Like Portugal, the Dutch government cited concerns over property speculation as one of the key factors driving the policy change. This is part of a broader trend in Europe to reconsider or phase out these residency schemes in response to growing public outcry about the impact of foreign investment on local communities.
The EU's Growing Skepticism Toward Golden Visas
The European Union has long raised concerns about the security risks associated with golden visas. In 2022, the European Commission called on EU member states to stop offering citizenship by investment programs. While golden visas do not directly provide citizenship, they allow individuals to gain residency in a European country, which can eventually lead to citizenship in some cases.
In addition to security concerns, the EU has also highlighted risks related to money laundering, tax evasion, and corruption. After Russia’s invasion of Ukraine, there was a renewed focus on ensuring that individuals from sanctioned countries could not gain access to EU member states through these investment schemes. The EU has also expressed concerns about the lack of transparency in how some countries manage these programs.
In 2022, the European Commission urged Albania to suspend its plans to introduce a golden passport program, warning of potential risks related to organized crime, corruption, and terrorist financing. Similarly, the Commission proposed suspending Vanuatu’s visa-waiver agreement due to concerns about its golden passport program.
The Status of Other Golden Visa Programs in the EU
Despite the EU's skepticism toward golden visas, several countries continue to offer them. Malta remains one of the few EU nations that still provides golden passports, with a minimum investment of €690,000. This investment allows for citizenship, and applicants can expect to receive it within 12 to 36 months.
Other European nations, including Italy and Greece, continue to offer residence-by-investment programs, albeit with varying requirements. Greece raised its minimum investment threshold to €800,000 in high-demand areas like Athens and Mykonos, while elsewhere it remains at €400,000. The Greek golden visa program is popular due to its quick processing time—applicants can secure a residency permit within 60 days.
Italy’s golden visa program, introduced in 2017, offers residence in exchange for an investment of at least €250,000. It is one of the more affordable golden visa options, and holders can eventually apply for citizenship after ten years of residency.
As Spain moves toward banning its golden visa program and Hungary reintroduces its own, the future of residence-by-investment schemes in Europe is uncertain. The European Union’s ongoing concerns about security, transparency, and housing affordability will likely continue to shape the policies of member states. While some countries are phasing out these programs, others are actively seeking to attract international investors through golden visa schemes.
For those looking to secure residency in Europe through investment, it’s important to stay informed about the changing landscape. The rules governing golden visas vary from country to country, and they are subject to change based on political and economic factors.
