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Spain may follow Portugal and Ireland in attracting foreign buyers with residency
December 07, 2012
As part of an effort to breathe life into its property market and alleviate a huge stock of unsold homes, Spain’s government is considering granting residence cards to foreigners who purchase a home valued at more than 160,000 euros. According to government data, there are some 700,000 unsold homes on the market since the property bubble burst in 2008.
“We have proposed to other ministries that non-residents who acquire a home in Spain valued at over 160,000 euros should automatically be granted a residence permit,” said Secretary of State for Trade, Jaime García-Legaz. “We are thinking of markets such as China and Russia, where there is growing demand for housing in Spain. Chinese and Russian nationals face difficulties buying a house in Spain because they are not residents of the European Union. Such an arrangement would follow similar agreements established in Portugal and Ireland; two other euro zone economies struggling to come out of the recent financial crisis.
“In a few weeks’ time, a reform of the law regarding foreigners will be put in place to reactivate overseas demand and contribute toward reducing the stock of housing,” said García-Legaz.
The troubled state of the country’s real estate market was further highlighted last week by data from the Bank of Spain showing that the level of bad debt in the country’s banks had risen to a record 10.7% of their loan total in September. Mortgage defaults continued to grow.