Plans To Grant Investor Residency Could Revive Spain's Real Estate Market

Plans To Grant Investor Residency Could Revive Spain's Real Estate Market

After a bubble that saw the price per square metre (about 10.76 sq ft) for new build property soar by almost 182% between June 1997 and June 2007, according to appraisers Sociedad de Tasación, the Mediterranean country was among the worst hit by the 2008 credit crunch and the ensuing recession. As thousands of units languished unsold, values declined rapidly—again, Sociedad de Tasación data shows that the price per square metre for new builds dropped by nearly 27% between June 2007 and June 2013.

Alex Vaughan of Barcelona-based realtors Lucas Fox thinks the overall decline was even higher. “From my personal experience, I’d say prices have gone down 20% to 50% and in some areas even more than that, although I think the market partly needed a retrenchment.”

However, hope is on the horizon for the Spanish real estate sector. Last May, borrowing a leaf from the book of other beleaguered countries, including Portugal and Cyprus, the Spanish government put forward a bill, the Proyecto de Ley de apoyo a los emprendedores y su internacionalización, granting residency to investors from outside the European Union who spend €500,000 or more in local property.

The bill is currently making its way through Parliament but is not expected to see significant amends. Experts at Residency in Spain, a joint venture between Lucas Fox and Spanish law firm Ecija, explain that, if the draft law remains unchanged, it will grant qualifying investors a special visa allowing them to stay in Spain for a year (up from the current 90 days), plus a further two-year residency permit, renewable every two years.

To read full article: Forbes

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