In 2008, when the financial crisis took hold in Europe, economic problems affected local real estate markets and investment volume shrank, with property prices falling 20–40 percent.
In a bid to stimulate capital inflow from abroad, certain Southern European countries launched "Golden Visa" programmes, allowing any foreign national above the age of 18 to become resident in a host country with the guarantee of a minimum investment in designated fields, including real estate.
The procedure is relatively straightforward and short in comparison to other ways of obtaining residency (via marriage, employment or family reunification). The authorities do not require applicants to be fluent in the host’s national language or even know the country's history, and document checks take from a couple of weeks to several months.
Greece, Spain, Cyprus and Portugal jumped on the bandwagon and started issuing residence permits to foreign nationals investing in their economies. Malta, having had a similar program since 1988, made the investment terms more flexible.
The fruits of the programs already can be seen: Thousands of foreign nationals have used the opportunity to obtain residence by investing billions of euros in participating countries’ real estate markets. Foreign buyer interest has encouraged the prices per square meter to grow.
The most popular Golden Visa programme in Southern Europe is the one in Portugal. Between the program's inception and late May 2018, almost 6,300 foreign nationals obtained Portuguese residency, investing €3.8 billion in the country's economy.
All Southern European residence-for-investment programs include property investment as an option. In Spain, the minimum property price is €500,000; in Portugal, the property must be at least €350,000 (if over 30 years old or located in an area of urban renovation). Malta requires an investment in both bonds and real estate: €250,000 has to be invested in securities and a minimum of €50,000 has to be spent on property rent over five years (for property purchase the amount increases to €270,000, putting total investment at €520,000).
Cyprus offers residence to investors buying property worth at least €300,000 and depositing €30,000 in a local bank account. Greece offers the cheapest program, in which residency can be obtained with a property investment of just €250,000.
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