The government’s proposal to grant special residence permits to foreigners who buy a home in Spain valued at over 160,000 euros — an initiative that exists in other countries, albeit with different modalities and objectives — has been applauded by construction companies and rejected by opposition parties. The aim is to run down the enormous stock of unsold homes — which savings bank CatalunyaCaixa recently estimated at 818,000 units — by offering them to non-European Union citizens. The Socialists have accused the government of winging it, while groups further to the left describe the initiative as an “affront” because it amounts to “selling” residence permits.
The granting of a temporary residency permit in return for an investment or the mere demonstration of economic solvency is not a new policy. Foreigners with purchasing power and offers of a work contract can obtain a residence permit in many states without having to buy a house. The case is different for immigrants looking to obtain a permit who come up against a depressed labor market. But again this is not an innovation of this government, it being in the order of things in many other countries.
Judging by the amount of money involved — homes valued at over 160,000 euros — the aim is to sell off tens of thousands of apartments built on the coast during the property boom for which there is weak domestic demand. Any initiative that attracts foreign investment is to be welcomed. But the authorities need to go beyond short-term fixes by considering longer-term measures that grant residence permits in exchange for more productive investments, as is the case in Portugal, France and Ireland.
The government is competing with other countries to sell housing to foreigners. In any case, much more information is needed. The government has announced it will shortly approve a decree on aliens that will allow such residence permits. In order not to make a botched job of it, it will have to clarify details on the conditions and reach of the initiative. It also needs to include precautions in order to prevent the arrangement being used to channel money from dubious origins.