Sometimes, especially for international investors looking to stablish in developed countries, such as those within the European Union, may find it a bit discouraging when researching about how to get a citizenship in one of those cities.

However, the panorama doesn’t have to be so hard, as many countries are offering considerably easy path for acquiring citizenship, and Spain is one of these countries. This is an exciting moment if you are an international investor, or someone considering investing abroad, and you are interested in all the things Spain has to offer you.

The reasons for wanting to become a permanent resident or a citizen in a foreign country are many, as many might be motivated due to tough and uncertain conditions in their homeland, while others might simply be fascinated by the beauty of Spain, or the dynamic lifestyle of some of its cities.

The Spanish Golden Visa program

One thing any international investors wanting to invest in Spain should be clear about, is the fact that being a resident and being a citizen are two different things. And in Spain, the first one, obtaining a Spanish resident visa is considerably easy for investors, while obtaining a citizenship, while highly achievable, is a little bit more involved.

But don’t be discourage, since being a resident in Spain already brings you and your family the possibility to live in this beautiful country, work, for your children to go to school and university, and to travel freely around most EU/EEA countries. And from residency, obtaining citizenship is the natural next step.

As many other countries in Europe and the rest of the world, Spain offers a Golden Visa program, which encourages international investment to any people who invest in one of the following:

  • Buying a property (real estate) for more than €500,000
  • Buying shares of a Spanish company for more than €1,000,000
  • Having more than €1,000,000 in a Spanish bank
  • Having more than €2 million in Spanish public debt

After this, some documents need to be send, and hiring a lawyer may be a good option. This will grant the investor and her/his family with a resident permit for one year, which can then be renewed each two years, always that the investor has been in Spain at least once per year.

Get a Spanish citizenship for investment

After five years of have resided in Spain, the investor can apply for a Permanent Residency, by having lived for more than six months each year previous to the application for the permanent residency.

The citizenship comes after ten years, which shouldn’t be a too hard time to wait for, as a residency brings most rights one would expect, and the citizenship grants a Spanish passport, and all of the rights a person born in Spain has.

Also, after obtaining the Spanish passport, the initial investment that allowed the investor and her/his family to get the Golden Visa (if no further investment have been done), can be sold or dispose, as no more Golden Visa renewals will be necessary for the Spanish naturalized investor.

International investment is an activity as exciting as it might be difficult, especially when taking decisions. And decisions when considering investing overseas can come in different forms, and one of the most prevalent ones is where to invest.

Right now, investing in Europe is a very popular option, as European market continues to be solid, and many European nations are still some of the most important economies in the world. Among these, one that has been attracting many international investors is Spain, with especial focus in investment in Barcelona.

Decisions are not over though, as Barcelona is the second largest city in Spain and a thriving city, with important history and huge relevance for Spain, Europe and the entire world; which leads to yet another question, which districts and neighborhoods are the best to invest in Barcelona?

Why investing in El Raval?

Of course, that decision of choosing one neighborhood or the other continues to be something driven by many decisions variables, such as the goal of the investment: Whether it is to get a Golden Visa and to stablish in beautiful Barcelona, or it is to start a new international business.

But the neighborhood of El Raval, is definitely one with a high value among Barcelona’s neighborhoods. The importance of El Raval, located in the district of Ciutat Vella (literally Old City in catalan) is due to its recognition as one of the most vivid, colorful, visited and full of culture places in the entire Mediterranean city.

Investing in El Raval, means investing in one of the most important places in Barcelona, and that’s already a lot to say, being Barcelona such an important economic and cultural center in Spain and the entire Europe.

For investors looking to stablish in the exciting Catalan capital, El Raval is the opportunity of living in one of the most important points of the city, where there’s always so much to do, and where even famous people have lived; this makes it a great opportunity if looking to get a Golden Visa by investing in real estate in El Raval, getting the opportunity to live at a dynamic neighborhood.

Where to find the best investment deal in El Raval?

Being El Raval a neighborhood which has changed for the best since not so many years ago, the real estate market in this part of Ciutat Vella is thriving, with many opportunities to get a property in Barcelona.

The real estate offer at El Raval is quite impressive, with many options on a wide range of prices, mostly composed by apartments and flats; most of them in very good conditions, with modern interiors, and surrounded by the lives of hundreds of locals and tourists.

El Raval is also very famous for its bars and restaurants, apart from having some pieces of architecture and historical places that are often part of traveler’s itineraries. This makes it a great opportunity to invest in Business in El Raval, especially those involving services, entertainment and food.

Contacting with a real estate agency to get advice on finding the ideal international investment deal at El Raval is a great idea. However, if looking for references on prices and real estate opportunities, internet is a great resource to find investment opportunities in Barcelona.

Whether you are a local considering investing in real estate, or you are a seasoned international investor evaluating the idea of buying investment property in Spain; it’s good to know that this is actually a good time for real estate investment in Spain.

It seems the Iberian country is finally on the track towards a financial recover, and the darkest days of the economic crisis that hit Spain and the Eurozone are mostly gone, and even if there’s still a way to go for the country, things like real estate are recovering, and prices are quite good.

There are still a few questions to be asked however. Many investors looking to acquire Spanish investment property, may be concerned about what is the best city to invest in, and how to find investment property for sale in Spain. Luckily though, both questions have answers.

Best ways to find investment property in Spain

The real estate business in Spain is a quite active one, and after the so called bubble burst of 2008, prices are increasing steadily in the market, which is good for people looking to stablish, as there are still very good deals, and to invest, since renting is in a good position in Spain right now.

With this modest but attractive enough real estate boom that Spain is experimenting, real estate companies, either locals or international ones, are actively offering properties for sale in the whole country, and most of these options have good online platforms to find investment property in Spain for sale.

One of the best things is that Spain has a good tradition of being attractive for international investors, which makes local and national real estate agencies also willing to offer good services to investors overseas, offering services in English and other languages.

If you have a clear idea of where you want to invest in Spain, then get advice or consultancy from a local real estate agency would be a good first step. However, if you are still evaluating options, then there are excellent real estate agencies online, which will help you find the best deal for investment property.

When investing in property in Spain, make sure to have a clear goal in mind. If you want to generate good passive income for renting, you might consider a mid-o-large sized city with good commercial activity and an active university life. This way finding the best investment property will be easier.

What is the best city to invest in Spain?

Investing in properties in Spain has yet another important factor to take into account, and that is the amount of important cities the country has, which turns it into a very diversified economy, where the option is not necessarily so obvious when it comes to buying real estate in Spain.

However, the decision doesn’t have to be so complicated, as there are cities that are of huge and undeniable relevance in Spain. These cities are:

  • Madrid
  • Barcelona
  • Málaga
  • Valencia

These are four important touristic, economic and educational centers in the Mediterranean country, which count with many investors, businesses, highly qualified workforce and renting and prices are good, even for major cities in Spain and Europe.

Obtaining residency in a foreign country is usually regarded as a hard thing to accomplish, due to the different requirements in your country of choice, making many investors to think it twice before investing overseas.

However, there are always possibilities for inmigrants in countries belonging to the European Union who are willing to contribute to the country, either by providing skills or competences in different areas; or by investing in properties, real estate or other assets.

In the case of Spain, the country has been offering an attractive opportunity for people from countries outside of the EU/EEA (European Union/European Economic Area) and Switzerland, offering their Golden Visa Program for international investors. An opportunity that has proven to be valuable for Chinese investors.

Why is a Golden Visa in Spain attractive for Chinese investors?

The presence of Chinese people in the expat community in Spain has been very relevant and has an historical origin. In the last years, it has grown to become one of the international groups with greater presence in the Mediterranean country.

On top of this, even if unemployment rates in Spain has been considerably high, a 95% of the Chinese expat community counts with a job, which shows both: The sense of community of Chinese people, and this resilience to thrive.

The more relaxed pace of life in Spain, along with it’s amazing architecture, beautiful beaches, great culture and many activities, including economic ones; mix together to offer Chinese investors unique opportunities to grow a business, and to enjoy a great life.

How to apply for a Golden Visa in Spain?

There is one big benefit from obtaining a Golden Visa in Spain over requesting a residence permit by different means, and it is how easy it is to obtain it after meeting the only requirement. The Golden Visa is a residency permit aimed for international investments. As such, to be able to apply, the person must do either of the following:

  • Acquire a property (real estate) in Spain worth €500,000
  • Buying shares of a Spanish company for a value of more than €1,000,000
  • Having more than €1,000,000 in a Spanish bank
  • Possessing 2 million euros or more in Spanish public debt
  • Invest in a business project inside of Spain that is able to: Generate employment, impulse technological/scientific development in the country, or generate a minimum socio-economic impact

After having made the investment, we must be able to provide a document that proves our investment, depending on the route we have decided to take. And we must deliver all the necessary documentation to the authority.

Doing international investment is a decision that may take many different aspects into account. To begin with, being certain that the generated ROI (Return on Investment) will be good. But there are also many other things to take into consideration.

Definitely one of the most important factors comes in the facilities a country gives investors to reside freely in the country. Many countries in Europe have taken this into account, offering a program called the Golden Visa, which has proven to be very attractive for investors out of the EU/EEA and Switzerland.

Many European countries are encouraging international investment with their own versions of the Golden Visa program; and some countries have proven to be more attractive for investors than others, but the program seems to be making good results, and will probably continue and expand.

What is a Golden Visa and why to consider it?

Getting a resident permit, being able to live a normal life in a country, with children going to a high quality European school, freely traveling through the European Union; all of these are also deal breakers for someone considering investing a large amount of money in a foreign country.

Some European countries, as well as some countries in the Caribbean Sea and other important economies; are well aware of this, and have been offering the so called Golden Visa, a program that grants a visa to international investors.

The most popular European Golden Visa programs are

  • Portugal
  • Spain
  • Greece
  • Malta
  • Latvia
  • Cyprus
  • Hungary
  • The Netherlands

And other countries such as Italy, Bulgaria, the UK and Ireland also offer the opportunity to acquire a Golden Visa.

But, what is a Golden Visa, anyway? It’s the opportunity of getting a visa by investment (the amount and the type of investment depends on the country), allowing to bypass the often difficulties of getting residency permits in most countries in the world.

And how much does it cost? The range of prices, as well as the nature of the investment, some most accessible than others, vary considerably.

The range of prices starts as low as €250,000 and may be as expensive as €2,000,000 for a citizenship. While the nature of the investment also affects the prices, being the cheapest those accepting investment in real estate, while the most expensive are those requiring to expend in public debt and national companies.

Countries offering Golden Visa in Europe – Which one to choose?

With the many options to choose from offering a Golden Visa, it would be worth it knowing beforehand which countries have been the most successful ones encouraging the investment of foreign investors in the countries.

The top five Golden Visa programs are:

  1. Portugal
  2. Spain
  3. Malta
  4. Cyprus
  5. Greece

Among these, Greece is the cheapest country to invest in, and Athens, despite its economic hardship, continue to be a beautiful and attractive city. A Golden Visa can be obtained by investing more than €250,000 in real estate, and allows to travel the Schengen area.

While Spain is a highly attractive country for international investment, with an economy that is recovering, and real estate prices getting back to its old glory, which can make it a very good deal, and it costs an investment of more than €500,000 in real estate.

The island of Cyprus also offers the possibility of real estate investment for €275,000; but they also offer an interesting alternative for a citizenship by investing €2,000,000 in luxury property purchase as well as construction of projects of residential and commercial nature.

Becoming an expat is one of those experiences that generate different feelings to each person who either decides to do it, or is forced by external factors (usually an unfavorable situation in her/his home country). And one of the most prevalent ones, is a sense of uncertainty due to the taxes one has to pay.

The taxation system for expats in Spain is well defined, and leaves it very clear to identify who have to pay what taxes, which is convenient in order to avoid misunderstandings, and to make sure that investing in properties in Spain is the right option for you.

Whether you are looking to invest in Spain to get a Golden Visa, or you want to relocate to Spain to work or study in the country; it’s vital for you to determine if you qualify as a resident (for tax purposes), or not, and determine how much you must pay from there.

Spanish tax system for expats

The first thing you must identify is whether you are a tax resident in Spain or not. You are considered a tax resident if you meet any of the following conditions:

  • You have lived for more than 183 days in Spain in a single calendar year (don’t have to be continuous), regardless if you are formally registered or no
  • Your main professional activities are based in Spain, that is, being employed or self-employed in Spain
  • Your main vital interests are in Spain (your family or your business)

Before considering the taxes expats in Spain must pay, it’s worth noticing that there exists a double tax treaty with the UK, and therefore, you don’t have to pay for your taxes twice, and you can pay only in either the UK or Spain.

The tax year in Spain comprises the entire year, from January 1st to December 31st, and you should pay between May 1st and June 30th.

If you don’t qualify as a tax resident, then you must only pay what is called the Income Tax, this means that you will have to pay a fixed tax rate for only the income you have generated in Spain, which is a 25% of your gross income.

On the other hand, if you are a tax resident, the income tax will be charge form your worldwide income, and the tax rate is progressive, including slight variations depending on the region or autonomous community you reside in or generate income at.

These tax rates will depend on the range of your income, and it starts from an income of €12,450 at a rate of 19% up to an income of over €60,0000 at a rate of 45%.

Tax residents will also have to pay for their worldwide income from savings.

There is also a personal allowance for tax residents for the Spanish income tax. For people under 65 years old, this allowance is of €5,550. For those over 65, the allowance is of €6,700; and from those of 75 years old or more, this rises to €8,100.

Another tax, called the Spanish wealth tax applies for tax residents, with a tax-free allowance of €700,000 for both residents and non-residents of Spain. For residents however, there is an extra tax-free allowance of €300,000; that is, residents will have to pay a wealth tax if their worldwide assets are over 1 million euros, and more than €700,000 for non-residents (but tax residents).

There are other taxes, such as the Spanish capital gains tax, which are not as straightforward, and it’s therefore worth it requesting advice with a professional Spanish tax expert or lawyer; as well as if there’s any doubt in regards to which of these taxes you must pay.

Some people decide to live their home country, either for a season, for a few years or forever; due to bad situations, such as social, economic or politic instability; to go for a better education, or to look for better opportunities for themselves and their families.

However, some expats move to a different country, either partially or completely, to look for investment opportunities abroad, being the decision of the country they decide to invest in based on many different factors; but usually, one common goal: Profitability, appreciation, good ROI and good passive income generation.

And for those expats in Spain, this is now an exciting time for real estate and property investment, especially considering the Golden Visa program, being Spain the second European country to attract international investors and encourage expats to buy real estate.

7 reasons for investing in Spain as an expat

You might have got to Spain as an expat looking for job and education opportunities, which many people from outside of the EU/EEA and Switzerland do. But you might also be an investor considering Spain as your new home, and of course, as your new place to operate your businesses.

No matter which position you fall in, many expats are investing in real estate in Spain thanks to the Golden Visa program; which has been successful on attracting international investment to Spain, offering an easier path to residency, with the possibility of upgrading to a permanent residency, and eventually a citizenship.

Some of the reasons for expats to decide investing in Spain are:

  1. Competitive property prices compared to other European countries
  2. Renting prices are growing
  3. The Spanish economy, once in crisis, is now recovering
  4. Spain is a highly popular country for tourists all over the world
  5. Most Spaniards are moving towards the entrepreneurial world
  6. Obtain a Golden Visa is relatively easy
  7. Investors don’t need to live primarily in Spain to keep their residency (Visiting Spain once a year is enough at least investor wants to get a citizenship)

These reasons, have convinced many expats to invest in Spain, but in regards to what is the best investment; the answer is usually Spanish real estate, but why?

In 2008, the prices of real estate dramatically fell, and now that economy is back in the good track, prices are slowly recovering, which makes it still very affordable to acquire a good property in a good zone in important cities.

For those wanting to generate passive income for renting, owning a property in Spain is also a great opportunity, as largest cities cannot meet the demand for houses, and many people rely on renting.

Best cities to invest in Spain

If looking to invest in Spain, its capital Madrid will probably your first option, and with good reason, as Madrid is an important economic center in Europe, but there are other cities that are great for international investors. The most popular ones, apart from Madrid, are:

  • Barcelona
  • Valencia
  • Malaga
  • Seville
  • Bilbao
  • Las Palmas (Canary Islands)

Depending on your business or your target market, choosing one city or the other might have a significant impact. For areas with a lot of population, youth and people looking for renting, Madrid, Barcelona y Valencia are great Spanish cities for expats to invest in.

There are usually two perspectives to look from when it comes to investing in real estate and acquiring properties. First, there are the people interested on buying a home to stablish, usually along with family, in a place they like; or to have as a vacation house.

While there’s the other perspective, and that is that of buying investment property; a favorite of many people looking to grow their assets, generate passive income, or buy and hold for a better ROI within the following years.

And for those considering investing in property, investors might consider acquiring the property in their country, since they may have greater control over the market. But acquiring real estate in the European Union, is also an important market, and Spanish real estate seems to be getting back to the good old times.

Why to invest in properties in Spain?

Investment property is usually an excellent way to create passive income and is also seen as a solid low risk asset to acquire, especially if the property is bought in an economically active region, and the property can satisfy the need of several people looking for housing.

And when it comes to buying investment property in Spain, the reasons may be greater, or smaller. To begin with, Spanish economy seems to have finally recovered from the tough crisis that attacked it since 2008, jobs are emerging (though there’s unemployment), and the price of real estate has increased.

Spain has value for the rest of the world, either as a place to live in thanks to a vibrant culture, or as a place to stablish a startup in one of the most important cities in the country. Also, their Golden Visa opportunity for investors has also attracted many international investors.

Are there risks with investment property in Spain?

One fear that usually strikes most investors when considering investing in real estate in Spain, especially when the goal is to generate a good return of the investment, is the economic crisis that Spain suffered and is just recovering from.

Of course, it’s important to consider that the outlook is good and there don’t seem to be signs of a sudden setback, as the Eurozone has recovered, and it seems that Spanish economy is now in the right direction.

The price of real estate has also recovered considerably, which along with the Golden Visa program, has attracted many international investors, but the fear for another bubble burst.

In this sense, if you are still considering investment property in Spain, even though right now the situation seems to be ideal, you might as well wait one more year, which should be a good indicator of how positive the future of Spanish real estate will be.

Tips for investing in real estate in Europe and Spain

Spain has many important national economic centers, and even though its capital, Madrid, is the most important one, the economy, as well as the population, are well distributed along the communities, which makes it good for investors, as they can make smarter moves such as buying on an emerging place.

If buying investment property in Spain, take the following tips into account:

  • Have a clear goal for your purchase: Are you interested on renting for small families in an important city? Do you want to rent full-featured luxurious summer houses in a Spanish beach? This can make the difference on what to look for.
  • Inform yourself about Spanish communities: Spain is an incredibly diverse country, with different industries, an every time more diversified youth, and different geographies, from coast to mountains. Learn about this before you decide where to buy a property in Spain.
  • Get advice from a specialized agency: There are professional agencies that offer financial advice and consultancy for international investors interested in buying real estate in Spain. Find one which values matches yours, and receive further advice to make the best investment decision.

Europe’s long history and culture is probably only comparable with its relevance to the rest of the world. This the why what happens in Europe, especially in terms of its economy, can affect the global market, and change the way people invest.

One of the key factors for Europe’s long history of success, even in the darkest moments of its economy, is a unified country, a stable democracy in most of its countries and good economic practices, with some of the richest countries in the world.

All of this turns Europe into a very attractive place for investors to stablish part or all of their businesses in the continent, and being able to get a residency in one country belonging the EU/EEA, also opens the possibility of more easily doing businesses with the rest of this important economic and political area.

Why is it worth investing in Europe to get a Golden Visa?

However, for investors outside of the EU/EEA and Switzerland, it might be a bit steeper to be able to get into the important market of Europe. And even for people not interested in doing business, the idea of being able to reside in Europe is still a highly attractive one.

This is a fact that many European countries knew, and have started taking advantage of this by offering the Golden Visa Europe Program. A program that some countries around the world are using to encourage international investment, and for countries in Europe, it has been giving very good results.

In order to obtain a Golden Visa in Europe, the basic requirement is to invest a certain amount of money (mostly an amount above the €250,000), but the exact minimum amount, and the type of investments applicable vary.

What European countries are offering Golden Visa programs?

Some of the most popular programs in Europe are:

  • Portugal
  • Spain
  • Greece
  • Malta
  • Cyprus
  • Latvia

From these, Portugal, Spain and Greece have been attracting a good amount of international investors, thanks to a mix of global importance, good deals in real estate and current economic outlook of the country.

Portugal is the most popular country in terms of their Golden Visa Program, and Spain accommodates in a second place, with the advantage of low prices in its major cities for a high quality house.

To have a clearer idea, Portugal and Spain offer a Golden Visa to investors outside of the EU/EEA and Switzerland for buying a property for a minimum of €500,000, or other alternative investments, being real estate the most popular and viable option.

While Greece, a country which is still considerably affected by the Eurozone crisis, offers much lower prices in properties, as well as a lower starter price to acquire their Golden Visa, with a minimum investment of more than €250,000 in real estate; half the price it would cost to get a Golden Visa in the most popular programs.

One thing that is worth considering is that, even if some countries have a brighter economic panorama than others; being able to freely reside in a country in the EU is already an excellent gateway to start doing business in such an important continent, earn a passive income, or retire.

With the apparently ever growing usage of the internet for more and more things in our lives, doing things from a long distance is less of a problem each year; and things that were considered a dream a few hundreds could do, such as working for a company in a foreign country while staying in yours, are now not only achievable, but more and more common.

However, there are still some things that are not entirely sorted out regarding doing it from a long distance; and one of these is investing in a city, either a different city in your homeland, or from an entirely different country or continent.

For people considering investing in Spain, Barcelona is one of the best cities to invest in real estate, and a great place to live, too. But not everybody is interested or able to relocate to take advantage of a good place to invest at, and investing in Barcelona from a long distance becomes the solution.

What should one take into account for long distance investments?

The goal for investors, especially does starting out in this exciting world, might be a three steps plan which might be outline as follows:

  1. Invest
  2. Retire
  3. Profit

Even if not unrealistic, the distance between the first step and the second one is usually a big larger, but way smoother than with most traditional jobs, and the profit part is more of a constant.

The idea behind this is that being a real estate investor and generating good and stable passive income are two things that gives us a huge flexibility, but we must still take care of our properties and investments, and even if outsourcing is a valuable tool, we shouldn’t neglect often taking a look at things ourselves.

For investors buying a property for renting or for buy-and-hold in Barcelona from a long distance, these considerations are worth being considered:

  • Leveraging internet and communication tools

Either if you live in the metropolitan area of Barcelona but outside of the Catalan capital, or you live in an entirely different country; taking advantage of communication technologies and the internet can make the experience as a long distance property owner smoother, and much more effective.

  • Hiring a property manager

If you have someone you trust in and can manage your renting businesses in Barcelona, it’s a great opportunity for you. However, if you are not able to constantly manage your property, hiring a property manager professional would be a good investment. Just make sure to hire one than brings a good service for a good amount.

  • Being willing to travel at least once a year

Even if you found the right property manager to take care of your investment property in Barcelona and you can really keep your business from a long distance; it’s still a good idea to visit Barcelona at least one per year to experience the state of your property first hand.

And an excuse to spend a few days in the beautiful Mediterranean Barcelona is never a bad idea.