The Foreign investors are increasingly present in the real estate market. They even come to represent the 14.85% of the total home purchase and sale operations in Spain. And those who invest the most are the British, Germans or Moroccans. For all these reasons, some countries have already decided to implement measures so that foreigners face a series of restrictions if they want to acquire real estate. For example, in Spain there is what is called “Golden Visa”. This term refers to the residence visa for investors, which allows non-resident foreigners who make a significant capital investment to legally reside and work in Spain. Although since the boom that is taking place and the increase in prices due to foreign investment, the Government is already ending the “Golden Visa”.
And all not only due to the increase in prices, but also due to the tightening of the conditions when obtaining a mortgage, since buyers have to contribute at least 20% of the value of the property. Therefore, it is becoming increasingly difficult for young people or families with less income to obtain a home in their name.
More and more citizens want to access housing. And everything happens with prices increasingly rising. According to Idealista, the leading real estate portal, last December a new historical milestone was marked again: the cost per square meter reached 2,271 euros. Therefore, it is becoming much more difficult to access housing. According to a study by OBS Business School, you have to allocate on average 40% of income to pay for access to a new home.
For all these reasons, Spain has the aforementioned Golden Visa restrictions for foreign investors, but what happens in other countries? Are there restrictions for foreign buyers?
Housing restrictions in Switzerland
In this Alpine country, foreigners, regardless of their place of origin, who reside legally can access a home as long as it is established as their main home. They can also access the purchase of land to build a home in that acquired territory within a year.
So the law is clear in this sense: If they wanted to acquire a second home within Switzerland, they would have to move to live there permanently.. When you move, the previously acquired home could already be established as a secondary residence.
In the case of vacation homes, they would need prior authorization from the State, although the regulations prohibit having more than one home intended for vacation use. Furthermore, another requirement in this housing law in Switzerland is the square meters of the property. This is also limited: The surface area of useful meters cannot be greater than 200 square meters.
Specific rate for foreign investors in Andorra
The Principality of Andorra has been one of the first to limit access to housing for foreign investors. In this territory, there was a measure that prevented non-residents from buying homes. Now, although it is no longer mandatory to be a resident, they must obtain a foreign investment permit.
This permit is a procedure that It can take several months and has several requirements. Not only the fee to access it, it also requires depositing half of the value of the property through a non-resident account. Finally, you must also pay the tax on foreign investment in real estate.
Minimum residence in Denmark to access housing
For at least five years. That is the requirement that the Danish government sets as permanent residence to be able to acquire property. A measure that has to be authorized by the Danish Ministry of Justice. But that residence has to be continuous.
However, citizens of the European Union (EU) and the European Economic Area (EEA) may be exempt from this authorization “in certain circumstances.”
Malta: only one home per foreign investor
This requirement in Malta has a reason. Due to the lack of housing and land to build on, the Spanish Ministry of Foreign Affairs believes that this could be the explanation. But if they live on the island of Malta for more than five years, they could buy more than one home.
And there is another requirement: if as a non-Maltese citizen we want to acquire a home, this home has to have a certain value on the market in order to be able to acquire it as a foreign investor.
Places in the world with restrictions on housing for investors
On the island of Australia, for more than a year, rates have increased in the field of foreign investment. Furthermore, the government decided favor investment if its purpose is social rent.
In a part that belongs to Finland, in the Åland Islands the main requirement is to have Swedish as a language to be able to buy a house, in addition to being Finnish. The Swedish language corresponds to the language of the region, a region of only 30,000 inhabitants.
Another place with requirements to access housing is China. Here you have to reside for at least one year and have a valid permit for the foreigner to acquire property. But, without a doubt, one of those places with stricter laws in this matter was Canada. In this country, citizens who were not born in the country were prohibited from purchasing homes. And although it is a temporary measure, it could be one of the reasons for the drop in real estate prices.