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The Spanish Golden Visa: A Key to Europe for Non EU Citizens

The Spanish Golden Visa

If you are from outside the European Union and have a minimum of €500,000 to invest in real estate in Spain,  the Spanish Golden Visa is a simple way to buy residency for you and your family.

It is the key to unrestricted travel around Europe as the Spanish Golden Visa allows you unlimited travel throughout the EU Schengen visa zone (for a maximum period of 30 days to a different EU country than the one granting the residency visa.)

The investment of minimum €500,000 must be in Spanish property. You have the option to buy a single property or a portfolio of properties. The latter option is a clever way to generate income from your investments to support your day to day living (if that is your plan).

Acquiring residency via the Spanish Golden Visa gives you the right to live in Spain and to travel freely to and from Spain which is within the Schengen visa area of Europe. The legislation has no minimum period of residence. Hence, as an investor, you can buy a property in Spain, obtain residency and then travel freely to and from Spain at any time.

As a result, your family can live in Spain permanently, enjoying a safe and quality lifestyle and with access to excellent schools, both state and private, selecting the type of education desired, whilst you travel as necessary for your work.

Spanish Renovation Project

Here is a brief outline of the Spanish Golden Visa application criteria:

  • A minimum investment of €500,000 in Spanish property.
  • The €500.000 investment can be for the purchase of several properties (purchase of land only is not acceptable).
  • The Spanish residency visa may be granted to immediate family members (spouse and children up to 18 years old).
  • There is no minimum stay requirement to renew the visa (ie. living in Spain is optional).
  • No minimum stay means no necessity to be tax resident in Spain.
  • The visa will be renewable for the first five years (the visa is renewable after the first year for a new period of 2 years. After the third year it is again renewable for a new period of 2 years, and after the fifth, the residents can become permanent) If you chose not to take permanent residency, you can continue to renew the visa as before.
  • Permanent residency in Spain can be applied for after five years.
  • The Visa allows unlimited travel throughout the EU Schengen visa zone (for a maximum period of 30 days to a different EU country than the one granting the residency visa.)
  • The application should take a maximum of 20 days (excluding time required to obtain and legalise necessary documents).
  • The investment in property (ie. completion of the sale) must be made before the Spanish Golden Visa application is submitted.
  • All property investments will result in a positive acceptance (usually only a criminal record will prevent acceptance).
  • Citizenship in Spain can be applied for after five further years of permanent residency* (although the law says that the standard term to apply for the citizenship for residency is 10 years)
  • EU citizenship is automatic with Spanish citizenship
  • At this point (ie after 10 years) a family can live, work and study anywhere in Europe.

*Please note that “permanent residency” status is only applied to individuals residing in Spain, on a permanent basis, for five years.

Requirements for the person making the Spanish Golden Visa application:

  • The applicant has not entered or stayed illegally in any Spanish territory.
  • To be 18 years of age or over.
  • To not have been refused entry in any of the Schengen countries.
  • To have public or private health insurance recognised in Spain.
  • To have sufficient economic means to cover personal and family living expenses (this amount will be revised regularly).
  • Proof of the investment must be made through a Registry of Property certificate proving ownership.
  • Or, if the ownership title is not yet registered, via a copy of the acquisition public deed and proof of filing the deed in the Registry.


The new Spanish Golden Visa application process for non-EU nationals is a step towards acquiring Spanish citizenship. It is a lengthy process but one that will open doors and provide opportunities for many people. A fabulous gift for your children!

The Golden Visa for Spanish Residency does not include a Spanish work permit as standard. For that reason, we suggest buying a Spanish Property Portfolio that actually provides you with an income if you are going to be residing in Spain and need to generate an income.

Remember that you will be required to show that you can support yourself and that you have health insurance when you apply for Spanish residency (Which will be granted automatically if you have spent over 500,000 Euros in total on your property purchases.)

Timing and accuracy of your application are paramount to a successful outcome.

We highly recommend using a carefully selected law firm to process your Spanish Golden Visa application.

At Buyer’s Agent Spain, in collaboration with our expert immigration lawyers, we guide you through every step of your Golden Visa Application process, from the initial property search to applying for your residency. As soon as you are ready to take the first step, simply contact us and we will make it happen for you.

 

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Buy To Let: Why Not Invest In A Spanish Renovation Project?

Spanish Renovation Project

 

Making a healthy profit on your buy to let investment need not break the bank. Provided you do your research and follow our advice, a wise investment can bring in a healthy return.

 

Needless to say, premium rental income villas and chic city pads in sought after locations come at premium prices. If prime real estate doesn’t fit your budget, a Spanish renovation project may be the opportunity you are looking for.

 

In this article, we will look at different types of properties to consider for your Spanish renovation project.

 

Invest In A Spanish Renovation Project: Country Living!

Inland Andalucia is simply stunning. Spanish country living offers the best of all worlds:

  • The sun shines as many days of the year as it does in the busy coastal areas.
  • Towns and villages are not overrun with too many tourists in the busy holiday times.
  • Neither are they ghost towns in low season
  • Space and scenery are up for grabs.
  • Your money buys you more property and more land.

 

Thanks to improved infrastructure in recent years, many inland areas now enjoy easy access to airports and coastal areas. This has led to an increased demand for inland properties by people looking for a beautifully natural environment, within a Spanish community, with less tourists, without giving up access to the sandy coastal beaches. This area has become particularly popular with families looking to relocate to Spain. These families are your ideal long term tenants.

 

The areas where we have had the most demand for long term rentals in the countryside are Alhaurin el Grande, Coin and Mijas Campo.

 

Building regulations are more complex in rural areas. Read our article 7 Legalities to Understand Before Investing in Buy To Let Property in Spain.

 

Invest In A Spanish Renovation Project: Village Life!

 

You have probably heard stories of properties for sale for €20.000 or even less in inland Spain. In all honesty, do you really believe these properties are in desirable areas? If you are looking for your own inland village hideaway in the middle of nowhere then yes, go for it. However, if you are looking to make a profit from your investment, we need to consider the location. In popular inland villages, apartments and small houses are in high demand for both short term and long term rentals and in many areas the demand is year round.

 

It goes without saying that even village properties in the prime areas, such as Mijas Pueblo, command a higher price however rental yield is also higher. Remember, we can help your property investment stand out from the crowd and consequently earn you a nice return.

Spanish Renovation Project

Invest In A Spanish Renovation Project: Chic City Lifestyle!

 

The Andalucian cities of Malaga and Cadiz are simply booming! For too many years these two beautiful places have been overlooked. Those days are over and soon too will be the ability to pick up great investment opportunities in these locations. In 2017, Malaga City property prices enjoyed an annual increase of 10% year on year. Not surprisingly, it is a magnet for buy to let investors. Cadiz is now hot on its heal thank to the attention given by the likes of Rick Stein and many others.

 

Excellent International schools attract wealthy families looking for quality long term rentals to the area. Museums, food and other attractions pull tourists from all around the globe. We have lost count how many nominations and awards Malaga has received for tourism over recent years.   

 

Despite this demand, and consequent price hikes, there are some great opportunities for a Spanish renovation project in parts of the city. You only need to ask!

 

Invest In A Spanish Renovation Project: Vive la Costa!

 

Needless to say, demand for both long term and short term rentals in almost all coastal areas in Malaga and Cadiz are in high demand, making this a desirable area for investing in buy to let properties.

 

In almost all areas of the Costa del Sol, you will find properties that would benefit from a facelift and interior refurbishment. It is important to keep your ideal tenant in mind when embarking on such a refurbishment. Remember, quality attracts quality.

 

Coastal locations such as Marbella and Sotogrande command prime prices for all property types.  However, careful research in popular areas such as Benalmadena, Fuengirola, Mijas Costa and East of Malaga can provide you with a very interesting investment opportunity without having to invest millions.

 

Invest In A Spanish Renovation Project: Something to think about?

 

Spending money renovating a property can seriously increase the level of return on your investment, providing of course that you have purchased the property at a good price. If money is no object then purchasing prime property will always yield prime returns.

 

However, if you are looking to bag a bargain in the popular areas, you will discover it is much more of a challenge these days. Heading a bit off the beaten track can lead to a lot more opportunities for this kind of investment. We are particularly excited about renovation opportunities in coastal locations on Costa de la Luz (where Lisa recently invested).

If you’d like to know more, simply drop us a line.

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How to Calculate ROI on Spanish Rental Property

Investing in a Spanish rental property can provide you with not only a second home in the sun but also steady rental income or capital appreciation when the property is sold for a profit. However, if your Spanish property purchase is primarily an investment, it is important to measure the return on investment (ROI) of the property to determine the level of profitability.

 

When deciding where to invest in your Spanish property, be careful, ROI calculations can be easily manipulated – and certain variables can be either included or excluded when making the calculation.

 

In this article, we’ll review two examples for calculating ROI on Spanish rental property. We will look at purchasing with cash and also with a mortgage. We will also highlight additional costs that sellers agents may not always remember to warn you about when making your calculations. We include a link to our Buyer’s Agent Spain  online tool to calculate the ROI on Spanish rental property, for your own use,

 

What Is Return On Investment (ROI)?

 

Return on investment  (ROI) measures how much money or profit is made on an investment. It is calculated as a percentage of the cost of the investment. Investors use ROI to determine how an investment is performing. It is also used to compare with the performance of other investments.

 

In simple terms, to calculate the profit on any investment, you take the total return on the investment and subtract the original cost of the investment.

 

ROI is a profitability ratio meaning it gives us the profit on an investment represented in percentage terms. To calculate the percentage gain on an investment, we take the net profit or net gain on the investment and divide it by the original cost as shown in the formula below:

ROI Spanish Rental Property

 

Calculating the ROI on Rental Properties

 

While the above equation seems easy enough to calculate, with property investment, a number of variables, including repair/maintenance expenses, mortgage payments, the amount of money borrowed (with interest) to make the initial investment, come into play, which can affect ROI numbers.

 

When purchasing property, mortgage terms can greatly impact the price of the investment. Using a mortgage broker can help you save money by helping you find favourable interest rates and conditions. (Contact us for our recommended partners)

 

In Spain, you need to add on taxes such as IBI, Basura, non-resident income tax, irpf (as mentioned in a previous article). We strongly recommend you consult with a reliable accountant/gestor before calculating your own ROI on Spanish rental property. (NOTE: Our bespoke property finder service includes this consultation as part of the initial research process).

 

Calculating the ROI on Spanish Rental Property: Cash Purchase

 

If you buy a property outright, calculating its ROI is fairly straightforward.

Here is an example of a rental property purchased with cash:

  • You pay  €100,000 in cash for the buy to let property.
  • The purchase costs are €12,000 bringing your total investment to €112,000 for the property.
  • You collect  €500 in rent every month.

12 months later:

  • You earned €6,000 in rental income for that year.
  • However, there were expenses including the non resident tax, property taxes, and insurances totaling €600 for the year or €50 per month. *(NOTE: there are many expenses that can be deducted to improve your annual rental income figure, check this with your gestor/accountant)
  • Your annual return is €5,400 for the year (€6,000 – €600).

To calculate the property’s ROI:

  • Divide the annual return (€5,400) by the amount of the total investment or €112,000.
  • ROI = €5,400 ÷ €112,000 = 0.048 or 4.8%.
  • Your ROI is 4.8%.

 

ROI Spanish Rental Property

 

Use our ROI calculator: https://docs.google.com/spreadsheets/d/1L-eCnHTS03bR3j40JFMHT9PFxltewb-eI5l_hLSuJMk/edit?usp=sharing

 

Calculating the ROI on Spanish Rental Property: Purchase with  Mortgage

 

Calculating the ROI on financed transactions is a little more complicated.

.

For example, you purchased the same €100,000 rental property as above, but instead of paying cash, you took out a mortgage.

  • The down payment needed for the mortgage was 40% of the purchase price or €40,000 (€100,000 sales price x 40%).
  • Total purchase costs are higher (14%) due to the mortgage, totalling €14,000.
  • Your total purchase costs are €54,000 (€40,000 + €14,000).

Plus, there are ongoing costs associated with the mortgage.

  • Let’s assume you took out a 25-year loan with a fixed 2.5% interest rate. On the borrowed €60,000 (€100,000 sales price minus the €40,000 down payment), the monthly principal and interest payment would be €269.17.
  • Rental income of €500 per month for a total of €6,000 for the year.
  • Your monthly cash flow was of €230.83 monthly (€500 rent – €269.17 mortgage payment).

 

ROI Spanish Rental Property

 

Over 12 months:

  • You earn €6,000 in rental income for the year, at €500 per month.
  • Annual adhoc costs of €600 based at €50 per month
  • Your annual return is €2169.96 (€230.83 x 12 months).

To calculate the property’s ROI:

  • Divide the annual return by your original purchase expenses (the deposit payment of €40,000, plus purchasing costs of €14,000) to determine the ROI.
  • ROI: €2169.96 ÷ €54,000 = 0.0502.
  • Your ROI is 5.02%.

 

ROI Spanish Rental Property

 

Use our ROI calculator: https://docs.google.com/spreadsheets/d/1L-eCnHTS03bR3j40JFMHT9PFxltewb-eI5l_hLSuJMk/edit?usp=sharing

 

So there you have our introduction to how to calculate ROI on Spanish rental property. In our introductory examples, for ease of comprehension, we focused solely on long term rentals. There are many more methods and calculations should you wish to delve deeper. This article may be of interest: “How to Value a Real Estate Investment Property.”

 

From these simple calculations, you can see that ROI differs depending on whether the property is financed via a mortgage or paid for in cash. In general, the less cash paid upfront as a down payment on the property, the larger the mortgage loan balance, the greater your ROI. Conversely, the more cash paid upfront and the less you borrow, the lower your ROI, since your initial cost would be higher. In other words, taking out a mortgage allows you to boost your ROI in the short-term since your initial costs are lower.

 

To read next: Buy To Let: Why Not Invest In A Spanish Renovation Project?

 

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7 Legalities to Understand Before Investing in Buy To Let Property in Spain

Buy To Let Property in Spain

As we have already mentioned, in previous articles, the decision to invest in buy to let property in Spain is not to be taken lightly. Careful market research, independent expert advice and legal support are essential for a successful investment.   We believe it is fair to say that the horror stories the newspapers and TV shows like to portray are of people who have invested in buy to let property in Spain who have not followed those steps!   Nowadays the Spanish property market is better regulated than in the past and contracting an expert and independent lawyer eliminates any risk when purchasing. (Please remember that we only offer our bespoke property finder service to purchasers who enlist the support of a suitably qualified lawyer).

Let’s have a brief look at a few legalities you need to be aware of before investing in buy to let property in Spain…

 

 

 

Licence of First Occupation (LFO):

If you are wanting to rent out your property as a short term or holiday let, it is essential it has a licence of first occupation. Any reputable lawyer will advise you not to purchase a property that does not or cannot obtain an LFO, no matter how much of a bargain it may appear!

AFO Certificate (Asimilado Fuera de Ordenación):

This licence is particular to inland/campo properties.  It is a document that officially declares a property to be assimilated in the planning regimen of ‘fuera de ordenación’ – a category assigned to properties that do not conform to current planning regulations but are accepted by the authorities. Introduced by the Andalucian government, the certificate helped regulate many inland properties that had previously been considered “illegal”. It also provides advantages in terms of greater legal certainty for prospective buyers.  If a property you wish to purchase does not currently have an AFO, negotiations will be required to ensure the certificate is acquired before the purchase is completed.

Building Restrictions:

It is important to understand what can and cannot be done to a property before you sign on the dotted line. Due to a large amount of illegal and unauthorised building in inland and campo areas, it is practically impossible to obtain permission to extend or make structural changes to inland properties. Your lawyer will be your saviour here. Do not be sold a possibility that does not exist! This includes swimming pools. If a country property does not have a pool, you cannot install one. A temporary one yes, but if it has to be removed …

Energy Certificates:

It is illegal to rent or sell a property in Spain without having an energy certificate, (Real Decreto 235/2013). Buyers and tenants must have access to an energy efficiency certificate providing objective information on the energy characteristics of the property. This allows potential buyers or lessors to assess and compare the energy characteristics of different buildings in their decision prior to procurement or signing of a lease should they wish to do so.

 

Investing in Rental Property in Spain

 

 

Rental Property Registration:

Short-term rentals in Andalucia are governed by regulations and you must register your property with the Junta de Andalucia (regional government), who will issue you a licence to rent your property.  Without a licence, you will not be able to advertise your property on portals, such as Airbnb and HomeAway, and if you are found letting to tourists without one you will receive a hefty fine. The application procedure is not a complicated one however fines for not doing so are hefty!   Long-term rentals are covered by the LAU (Ley Arrendamientos Urbano – Urban Rental Law). Although there is no requirement to obtain a specific licence, you will need a legal contract, in Spanish, agreed and signed by both tenant and landlord. The rental contract must include statutory points that protect both parties. Your lawyer will assist with this.

Tax Obligations:

Understanding your tax obligations is essential to accurately calculate the potential return on your investment. Ask your lawyer, accountant or gestor to explain taxes such as IBI, Basura, non-resident income tax and irpf. Late payment or non-payment of taxes in Spain carry hefty fines!

Spanish Wills & Inheritance:

Before investing, it is important to understand local death and inheritance law in Spain. Spanish law states that, in the event of the death of a property owner, the property automatically passes to children, rather than a spouse. If you wish your spouse to inherit the property you must make a Spanish will, stipulating your chosen distribution of your Spanish assets. This will does not cancel out any will you have for assets in other countries.

Remember, if you are thinking of buying property in southern Spain, we are here to help YOU!

  • We help you save time and money.
  • We eliminate risks and stress.
  • We help you avoid the all too common pitfalls.

This is our promise to you.

To read next: How to Calculate ROI on Spanish Rental Property

 

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Investing in Rental Property in Spain: Short Term vs Long Term Rental.

In our previous article, “An Introduction To Buy To Let in Spain” we looked at why investing in a rental property in Spain is a good idea and how to safely invest in a buy to let. 

 

In this post, we are going to consider the pros and cons of short term and long term rentals in Spain, in relation to your buy to let property.

 

When investing in rental property in Spain, both types of rental have their advantages but also their risks. With careful research and planning, expert guidance and assistance, you can be sure of success whichever decision you take.

 

Firstly, let’s consider the advantages of each rental type …

 

Investing in Rental Property in Spain: The Advantages of Long Term Rentals

 

A long term contract, for rental property in Spain, usually has a term of 11 months, with an option to automatically renew for up to 5 or even 7 years. From the outset, this can be a good idea as you have a guaranteed return on your investment over a sustained period of time.

 

Provided you choose your tenants carefully, a long term rental is a safe way to maintain and upkeep your property. Experience has shown that long term tenants have a tendency to look after a long term rental property as it was their own. Remember that quality tends to attract quality.

 

Maintenance costs are generally lower for long term rental properties and some responsibility is passed onto the tenant. As the landlord, you are responsible for repair and replacement of fixtures and fittings due to wear and tear. However, unlike with short term rentals, any damages caused by the tenants must be repaired when the property is handed back, at the end of the contract.

 

In most areas of southern Spain, there is extremely high demand for good quality long term rental properties.  As we mentioned in our introductory article, people from all over the world are relocating to southern Spain. Malaga and the Costa del Sol continue to be the preferred destinations for young professionals, families and wealthier retirees. Flexible working conditions allow more people to work from home or travel freely. Excellent international education options attract families from all around the world. People relocating often choose to rent before they buy, ensuring they have the ideal location before financially investing

 

When all goes to plan with a long term rental, your buy to let property in Spain can easily pay for itself over a long period of time.

 

Investing in Rental Property in Spain: The Advantages of Short Term Rentals

 

A short term contract, for rental property in Spain, usually has a term from 1 day to 6 months. It is your decision to select the minimum stay you would accept for a rental. Again, this depends on the type of tenant you want to attract.

 

As previously mentioned, the trend towards independent travel has lead to a boom in private rentals via websites such as  Airbnb and Owners Direct. This has allowed property owners to benefit, particularly those with properties in sought after locations. The fact that short-term holiday rentals are now tightly regulated in Andalucia has instilled confidence in the local holiday rental market. Spain, particularly the South, continues to be the most popular holiday destination for British tourists and is the number of visitors from around the globe increases year on year.

 

A short term rental is an ideal option if you wish to also enjoy your property. You can enjoy the flexibility of offering only dates that you yourself do not wish to use. You can earn money from your investment whilst also enjoy your new home. Return on investment and profitability must of course be taken into consideration with this option. You must decide which is your priority.

 

Short term rentals demand higher prices over a shorter period of time. As a guide, a property that achieves a monthly rent of €1000 per month can achieve €900 – €1000 per week in peak season. Again, market research and expert guidance is essential before making your investment in the right location.

 

So there you have the good news, let’s now consider the disadvantages for each rental type …

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Investing in Rental Property in Spain: The Disadvantages of Long Term Rentals

 

The stability of a long term rent-paying tenant is very attractive. However, Spanish law is almost always on the tenant’s side. It is important to understand Spanish rental law when making the decision to long or short term rent your property.

 

For this reason, we work very closely with a legal team who have a thorough understanding of contract law and they will keep you updated with changes as they occur.

 

Once you sign a long term rental contract, you need to be prepared to give up personal use of your property for up to 5 years. A long term contract that stipulates the use of a property as a “permanent abode” automatically entitles the tenant to a contract renewal for up to 5 years. Provided the tenant pays the rent and does not break any clause in the contract, you are unable to ask them to leave the property.

 

Long term rental may not be the most profitable option. Short term rentals command much higher rates. However, a combination of the two may also be the answer. This is an important point that we will study with you before you make your decision on where to invest.

 

Investing in Rental Property in Spain: The Disadvantages of Short Term Rentals

 

Short term rentals tend to incur more costs that long term rentals. General costs include property management, cleaning, changeover costs, repair and maintenance. You must also account for sales commission if an agency manages your property and if you manage the property yourself then don’t forget marketing and advertising costs.

 

Although there is very high demand for short term rentals, there is also increasing supply. To ensure a good return on your investment you need to stand out from the crowd. Attracting your ideal tenant in a busy market can be challenging. But don’t worry, we are experts at that and are here to help you!

 

Before we finish, let’s consider another option…

 

Investing in Rental Property in Spain:  Combining Short Term and Long Term Rentals

 

For many buy to let property investors in Spain, this is the ideal choice. It can be your way of literally having your cake and eating it.

 

Provided you do your research and seek guidance, you can not only enjoy using your beautiful new Spanish home, to share with family and friends or simply escape on your own but also get the property to pay for itself.

 

Subject to your chosen location, there is an opportunity to short term rent in the summer months, choosing the weeks you want to rent out yourself and also to offer longer term rentals in the non-peak season months. “Non-peak season” longer term rentals are popular with the likes of teachers, contract workers and even Scandinavians. Teachers opt for rentals between the school term months of September to June, this allows them to avoid high summer rental prices when they do not need to occupy the property. Scandinavians tend to avoid tourist locations in the busy summer months opting for the mild spring, autumn and winter months.

 

So, we hope this has given you plenty to think about. Investing in Rental Property in Spain can be a very profitable business whether you opt for a short term rental, long term rental or a combination of both. The decision is yours and we ’lll be only too happy to guide you along the way.

 

To read next:  7 Legalities to Understand Before Investing in Buy To Let Property in Spain

¡Hasta pronto!

Lisa & Louise

 

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