Golden Visa Programs, Once a Boon, Lose Their Luster

Long overdue:

Faced with growing pressure to address its housing crunch, Spain said this month that it would scrap its golden visas, the latest in a wider withdrawal from the program by governments around Europe.

Half a dozen eurozone countries offered the visas at the height of Europe’s debt crisis in 2012 to help plug gaping budget deficits. Countries that needed international bailouts — Spain, Ireland, Portugal and Greece among them — were especially desperate for cash to repay creditors, and saw a path to bring in investors while reviving their moribund real estate markets.

The golden visa program brought Spain billions of euros in investments. But property prices paid by rich foreigners are well beyond the earning power of locals.

Countries reaped a windfall: Spain alone has issued 14,576 visas linked to wealthy buyers making real estate investments of more than €500,000. But the prices that they can afford are squeezing people like Dr. Barba out of a market that had already been highly inflated by the rise of Airbnb and the draw of Wall Street investors.

“Access to housing needs to be a right instead of a speculative business,” Pedro Sánchez, Spain’s prime minister, said in a speech this month as he announced the end of the country’s golden visa program. “Major cities are facing highly stressed markets, and it’s almost impossible to find decent housing for those who already live, work and pay their taxes.”

The visas make it easy for people outside the European Union to buy the right to temporary residency, sometimes without having to live in the country. Investors from China, Russia and the Middle East flocked to buy real estate through them.

In recent years, British nationals have followed suit in the wake of Brexit, snapping up homes in Greece, Portugal and Spain, joined by an increasing number of Americans looking to enjoy a lifestyle they can’t afford in major U.S. cities.

But golden visa programs are now being phased out or shut down around Europe as governments seek to undo the damage to the housing market. And after Russia’s invasion of Ukraine, E.U. officials urged governments to end them, warning they could be used for money laundering, tax evasion and even organized crime….

Source: Golden Visa Programs, Once a Boon, Lose Their Luster