Chinese nationals investing in property in Spain are starting to get their residency visas, according to Spanish press reports.
A businesswoman from Shanghai who spent €520,000 on flats in Barcelona and Madrid has become one of the first Chinese nationals to get a Spanish residency via the new “Golden Visa” law that offers Spanish residency permits to non-EU nationals in return for real estate investments of €500,000 or more.
She invested in Spanish property via the Emigration Centre at Shanghai International Studies University (SISU), which has a programme to help Chinese nationals invest in residency schemes abroad.
SISU put her in touch with a firm of solicitors in Spain for conveyancing and residency services. These lawyers expect “more than 100 operations of this kind in 2014, with a total value in excess of 50 million Euros,” according to statements to the Spanish press.
The “Golden Visa” law came into force on the 29th September last year, and could channel a lucrative seam of demand towards Spain for prime real estate, primarily property in Barcelona and Madrid. However, chinese investors tend to prefer new property to resales, and city centre to coast, which means there is little product in Barcelona to satisfy this demand.
Rich pickings for cowboys
Another problem will be the number of cowboys this business attracts. Residency investors tend to be less informed about the risks of buying in Spain than other groups, and require a sophisticated and professional service operation to take care of their needs. It will be much easier to take advantage of their credulity and rip them off with over-priced property and no follow-up service. I can safely predict that many residency investors will get shafted in the process.