EU countries scrap “golden visa” to end affordable housing problem

Posted by David Henning on 8 March 2023

Portugal revealed that it would be ending its golden visa program in February 2023, with Ireland also announcing that it would close its Immigrant Investor Programme (IIP), known as the Irish Golden Visa.

 

A Golden Visa is essentially a means for wealthy internationals to acquire residency (and oftentimes, citizenship) by making a large property or financial investment in a country.

The Portuguese Council of Ministers announced the scrapping of its Golden Visa as part of a wider package of measures to tackle the country’s-housing crisis and combat real estate speculation.

China, Brazil, Turkey, the United States, and South Africa are the main beneficiaries of Golden Visa opportunities.

Purchasing real estate as a speculative investment is driving up real estate worldwide, especially with the proliferation of Airbnb, making second-holiday homes a highly lucrative endeavour.

In April, the city comptroller’s office of New York found that Airbnb exacerbated the city’s affordable housing crisis. Removing housing units from the overall supply so that they can be utilised for short-term rentals instead leads to higher rent prices.

The New York study found that Airbnb listings can be attributed to a 9.2% increase in the city’s rents over 5 years.

This has made certain areas of a city wholly unaffordable, with rents in Lisbon rising by 36.9 % in the fourth quarter of 2022 alone.

The city of Cape Town has paired up with Airbnb as part of its “work anywhere” initiative” in an attempt to attract Digital Nomads. In a city with a serious homelessness crisis and entrenched spatial apartheid, the economic gains from tourism could be outweighed by further aggravating a social crisis.

Spain has recently introduced a bill to scrap its Golden Visa, arguing that it has driven up housing prices throughout the country.

Picture: Getty Images

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