The impact of “golden visa” investment programs on the economies of EU countries


As of 2020, 13 EU countries had investment programs where, in exchange for the acquisition of real estate, shares or business, foreigners are issued a residence permit under a simplified scheme. According to a study conducted in the UK, which also provides a similar opportunity to foreign investors, the launch of such programs has a different impact on the economy.

In the course of the study, programs under the code name “Golden Visa” were examined, which, in addition to the UK at that time, operated in Bulgaria, Hungary, Greece, Ireland, Spain, Italy, Latvia, Luxembourg, the Netherlands, Portugal, Estonia, Cyprus and Malta. All data was borrowed from official sources, and the criteria used were the price index in the residential real estate market, the unemployment rate and GDP indicators for 1-3 years. The previous financial and economic crisis and its consequences were also taken into account.


The impact of Golden Visa programs on the economies of EU countries

As it turned out in the end, all states used their investment programs as an instrument of migration policy in order to attract additional resources to eliminate economic problems. It is no coincidence that this occurred during periods of economic downturn and regardless of whether similar programs existed in other countries.

Each of the three main options provided by the Golden Visa stimulates the local economy in one way or another: the sale of housing revitalizes the situation in the national real estate market, investments in government bonds reduce the debt burden, and investments in business projects create new workers places and, accordingly, the unemployment rate decreases.

However, Golden Visa programs account for less than 0.4% of total EU revenue. At the same time, the biggest earners from this were Great Britain (786 million euros), Portugal (726 million), Spain (697 million) and Greece (685 million), which are far ahead of Malta (230 million). However, the impact on the state of the domestic real estate market in each case was different.


The impact of Golden Visa programs on the economies of EU countries

Thus, in Greece, foreign investors concluded 72% of the total purchase and sale transactions, and 36% of buyers applied for a residence permit under the Golden Visa program. This was facilitated by the relatively small minimum purchase amount – 250 thousand euros, which is half as much as in Spain.

In Portugal, the minimum was 350 thousand euros, provided that the objects were not located in Lisbon and the nearest suburbs or in the resorts of the Algarve, where the bar was already raised to 500 thousand euros. The volume of foreign investment in Portuguese housing did not exceed 13%, and most transactions were concluded with the participation of EU citizens, and 22% of foreign buyers planned to obtain a residence permit in Portugal.

Citizens of non-EU countries took part in investment programs either to gain visa-free entry into Schengen countries or to improve their personal well-being. The other most common reasons were the desire to work in a new place, to give children a European education, or to acquire a “reserve airfield”. The latter option fully justified itself during the Covid-19 pandemic, when, unlike ordinary property owners, holders of residence permits and permanent residence permits could enter the EU using their status.



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