By: Benji Psaila & Malcolm Ferrante
In an era of unprecedented globalisation and mobility, investment migration has significantly influenced economic activity. Often, this phenomenon has reshaped the property landscape as countries worldwide introduce citizenship or residency programmes for foreign nationals. “These programmes often require a property investment, profoundly impacting real estate markets,” says Malta Sotheby’s International Realty, Head of Sales & Lettings, Benji Psaila.
“Immigration stimulates economic growth, and investment programmes that require property investment positively influence the property market by generating demand in both rental and sales sectors. As the demand for investment properties grows, the private property sector will continue to strengthen, offering applicants a secure investment and the potential for capital appreciation. This is especially true in a thriving economy with low availability, like Malta,” explains Malta Sotheby’s International Realty & CSB Group Investment Migration Adviser and IMC member, Malcolm Ferrante.
“Citizenship or residency in a stable country can offer applicants protection of assets and rights, as well as access to better healthcare, education, and legal systems. Investing in real estate in different countries can diversify an individual’s investment portfolio, spreading risk across various markets and currencies,” continues Psaila.
Ferrante further explains, “Citizenship and Residency by Investment programmes are available in several countries worldwide, many offering investment migration through real estate investment. These programmes are constantly evolving as countries strive to improve and protect the quality of life and property rights of their local population and foreign nationals wishing to invest. Some of the most popular citizenship and residency programmes are available in these countries:
Malta
Malta stands out as a pioneer in offering flexibility within its investment migration programmes. Through initiatives such as the Maltese Citizenship by Naturalisation for Exceptional Services by Direct Investment (commonly known as MEIN) and the Malta Permanent Residence Programme (MPRP), the country has attracted a diverse pool of investors. These programmes are among the most affordable in Europe and are some of the few that offer investors the choice to lease a property as part of their application instead of purchasing one.
Under the MEIN programme, investors can buy real estate in Malta with a minimum value of €700,000 or lease a property for a minimum annual rent of €16,000, retaining it for at least five years from the date of the citizenship certificate. Similarly, the MPRP allows investors to purchase a property with a minimum value of €350,000 in Malta or €300,000 in Gozo or the South of Malta. Alternatively, they can lease a property with an annual rent of €12,000 in Malta or €10,000 in Gozo or the South of Malta.
Greece
In Greece, the Residence by Investment programme has emerged as a beacon of opportunity for international investors seeking swift residency. However, there have been challenges related to housing affordability for locals due to the influx of investment migrants. To safeguard local residents’ interests and promote stability in the property market, the Greek government has increased the minimum value of a property investment required to qualify for the programme.
Portugal
The impact of the Investment Migration programme on Portugal’s property market mirrors the challenges seen in Greece, prompting the Portuguese government to implement strategic measures to safeguard the property market while promoting economic diversification.
One significant measure taken by the government is the removal of property investment as a requirement for obtaining the permanent residence. Instead, the focus has shifted towards investment in the Portuguese private sector, fostering economic growth and job creation in other industries.
Spain
Spain introduced its residence by investment programme in 2013, offering residency to foreign investors and their families who invest in Spanish property. To qualify, investors must commit €500,000 to real estate, granting them the right to live, work, and study in Spain. The visa can also be obtained by starting certain types of businesses in Spain, holding company shares or bank deposits worth at least €1 million in Spanish financial institutions, or investing at least €2 million in government bonds. Spain is, however, considering tougher application requirements, such as raising the investment requirement for luxury properties to €1 million. In a bid to increase the amount of affordable housing available to locals, it might also follow Portugal in revving if not ending its Investment Migration programme for real estate purchases.
Italy
Italy offers an appealing option for individuals seeking residency through investment. Introduced in 2017, the Italian Investment Migration programme provides non-EU nationals with a two-year residence permit in exchange for an investment in Italy. Unlike other programmes, a property investment is not required for Italy’s offerings. Instead, investors must commit a minimum of €500,000 through an Italian limited company. This investment opportunity extends to family members included in the application. After residing in Italy for 10 years under the scheme, participants become eligible to apply for citizenship, offering a long-term prospect for those seeking permanent residency in Italy.
Caribbean
The Caribbean region hosts three prominent citizenship programmes: St. Kitts and Nevis, Saint Lucia, and Grenada. These programmes share commonalities, particularly regarding property investment requirements. Investors have three primary options, one of which includes property investment in a government-approved real estate project. This option allows investors to contribute to the local economy while obtaining citizenship in these nations.
In conclusion, investment migration has emerged as a transformative force in the global economy, significantly influencing property markets and offering individuals unprecedented opportunities for mobility and investment diversification. Through programmes like those in Malta, Greece, Portugal, Spain, Italy, and the Caribbean, governments seek to attract foreign investment while addressing local needs and fostering economic growth. As these programmes evolve to balance economic incentives with social and regulatory considerations, they underscore the dynamic interplay between globalisation, real estate, and citizenship. Ultimately, investment migration represents not only a pathway to residency or citizenship but also a catalyst for economic development and international cooperation in an ever-changing landscape.
The Authors:
Benji Psaila
Malta Sotheby’s International Head of Sales & Letting
t: +356 2010 8070
[email protected]
maltasothebysrealty.com
Malcolm Ferrante (IMC member)
Malta Sotheby’s International Realty & CSB Group Investment Migration Adviser
t: +356 2010 8077
[email protected]
maltasothebysrealty.com