Moving to Spain Just Became Impossible If You Don’t Have Tons of Cash

A growing number of Americans choose to live abroad for various reasons, including a change of scenery, greener pastures, or a cheaper cost of living.

Many European countries can be particularly appealing when deciding where to set sail, thanks to the so-called “golden visas.” While these vary by country, they generally allow foreigners to live in a country in exchange for an investment— usually real estate. There is also a minimum amount expats must invest, depending on the country.

While these visas have gained popularity in recent years, the constant influx of new entrants has also garnered dissatisfaction among locals, who argue that it puts pressure on housing and prices.

In turn, many of these countries have recently decided to either increase the minimum investment required or end the golden visa programs altogether. Spain, for instance, announced it would terminate its program in April 2025.

 Moving to Spain

Spain has been particularly attractive to Americans. As Bloomberg reports, there were “41,000 Americans living in Spain in June, a 39% increase from three years ago and double the number from 2014.”

But it’s not just Americans. English residents have also been moving to the country after Brexit, and the nation is the “most popular European country for British expats, with well over 350,000 British citizens officially registered as living there,” according to Immigration Advice Service.

Spain has emerged as one of the most preferred locations for expats looking to settle in a place with a better living standard than their previous location, great weather, and reasonable property prices as compared to other Western European countries, says Nathan Richardson, founder of CashForHome.com.

“Regions like Costa del Sol, Barcelona, and Balearic Islands are well known for their foreign buyers looking to purchase vacation and permanent houses, which has resulted in the booming of the real estate business in Spain,” he explains.

However, with the end of the golden visa program, choosing to move to Spain might become more challenging—and pricier.

Robb Report notes that Spain has issued 15,000 visas since the program’s inception in 2013, adding that with less than three months left to apply, “the demand has skyrocketed in recent days.”

The Spanish golden visa came at a hefty price: Options were to acquire real estate with a minimum value of EUR 500,000 ($51,000); or have “investment funds, bank deposits, or listed company shares in Spanish financial institutions with a minimum value of EUR 1 million” ($1.02 million); or have a “government bonds investment with a minimum value of EUR 2 million ($2.04 million), according to investment migration consultancy Henley & Partners.

The new tax hike

To complicate matters—and make them much pricier—Prime Minister Pedro Sánchez announced on Jan. 13 that the country would impose an eye-popping 100% tax hike on real estate investments for non-EU residents, including the U.K.

As the Financial Times reported, Spain “is one of many European countries where public anger is mounting over the difficulty of finding affordable housing, as property prices soar and construction lags far behind demand.”

Spain has experienced a huge housing shortage in recent years, and this measure could help ease the lack of housing available.

“Just to give us an idea, in 2023 alone non-European Union residents bought some 27,000 houses and flats in Spain and they didn’t do it to live in, they didn’t do it for their families to live, they did it to speculate, to make money from them, which we cannot allow in the context we live,” Sanchez said on Jan. 13, according to Bloomberg.

Indeed, the sharp inflow of non-EU investments into the Spanish real estate sector has exacerbated the prices in several key locations, making it difficult for local investors to afford, says Richardson.

“Elevating taxes for foreigners allows the government to temper overseas demand, tame the increasing property prices, and foster adequate competition such that domestic investors are not overshadowed by foreign investors with deeper pockets,” he adds.

Time to start looking closer to home?

“While Spain offers undeniable charm, navigating higher taxes and tighter regulations means buyers may need significantly more resources to establish a foothold there,” says Richardson. “For those deterred by these barriers, options closer to home might be worth exploring.”

Against this backdrop, Americans dreaming of greener pastures or cheaper living alternatives might benefit from looking for locales closer to home.

Of course, inflation and high mortgage rates have put pressure on many Americans these past few years. These impediments, coupled with the “lock-in effect”—sellers unwilling to sell due to securing much lower mortgage rates a few years ago—have made the situation very challenging for many.

According to Freddie Mac, the 30-year mortgage rate was 6.93% as of Jan. 9. While Realtor.com® expects mortgage rates to remain above 6% in 2025, it also predicts that they will drop to 6.2% by year-end, according to its 2025 Housing Forecast.

In addition, some metros will still be more affordable and might be worth a look. 

Colorado Springs, CO; Fort Lauderdale, FL; Norfolk, VA; El Paso, TX; and Richmond, VA, are among the forecasted top housing markets of 2025, according to Realtor.com research. 

Richardson also notes that some major U.S. cities could see an increase in housing availability by 2025, driven by accelerated urban development and changing migration patterns.

“Cities like Austin, Nashville, and Chicago, which are undergoing rapid transformation, could provide attractive opportunities for affordability and investment without the complications associated with international taxes or residency requirements,” he adds.