The golden visas of Greece, Portugal and Spain: economic drivers and the housing crisis

The Golden Visas of Greece, Portugal and Spain: Economic Drivers and Housing Crisis

Southern European economies have seen remarkable recoveries since the financial crisis more than a decade ago, driven by a tourism boom and the arrival of foreign investors. However, this growth has led to skyrocketing housing costs, exacerbated by golden visas that attract foreign property buyers. Meanwhile, northern Europe faces its own housing crisis, despite very different economic conditions.

The double edge of the economic sword in Southern Europe

After overcoming the after-effects of the European financial crisis, southern European countries such as Greece, Spain and Portugal have seen their economies rebound impressively. A key element of this recovery has been the influx of foreign capital, particularly through real estate investments and golden visas, who offered a residence in exchange for significant investments in real estate.

This influx, however, had the unintended consequence of driving up property prices, making housing unaffordable for many local residents. Cities like Lisbon and Athens, once accessible, are now grappling with rising living costs, pushing young people and families out of central markets.

The other side of the coin: the housing crisis in the North

Paradoxically, while southern Europe struggles with the side effects of its economic success, northern Europe faces its own real estate challenges. Countries like the Netherlands and Germany are seeing property prices soar due to limited supply and growing demand, exacerbated by restrictive construction policies and relatively high interest rates.

In Germany, house prices are just beginning to stabilize after a significant correction, while the Netherlands faces an unprecedented housing crisis, with new homes reaching astronomical prices.

Is a transnational solution possible?

Europe's housing crisis knows no borders, affecting both the north and the south with regional nuances. Although golden visas have contributed to the economic prosperity of some countries, they have also exacerbated the housing crisis, highlighting the need for a more balanced approach between attracting foreign investment and ensuring affordable housing for local residents.

Measures are being taken, such as the review of the golden visa programs in Portugal and Spain to mitigate their impact on the real estate market. These efforts aim to rebalance the economic benefits of foreign investment with the housing needs of citizens.

It is crucial for European countries to find common ground, where foreign investment can coexist with an accessible housing market. Perhaps closer collaboration and harmonized EU-wide policies could be the key to solving this shared crisis.

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Charles Foucault From Yourtopia.fr

Charles Foucault

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