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Monday, July 21st, 2014

China at the forefront of investment interest following the passing of the ‘Entrepreneurship Law’

Exclusive villa on the Costa BlancaIn September 2013, the Law to Support Entrepreneurs and their Internationalisation came into force. Amongst this law’s functions is the significant support it provides in attracting foreign investment to our country, particularly that related to the acquisition of property with a value of €500,000 or more. As is now widely known, such a transaction is accompanied with the concession of a visa and, later, a residency permit to the foreign investor and his/her spouse and children under the age of 18. Another advantage that this investment in Spain brings is the possibility of being able to circulate freely between countries pertaining to the Schengen area.

Towards the end of May 2014, 81 of these visas had already been issued. Although this is not a particularly high number, it is promising given that the new Law has only been active in our country for a few months, and it can be expected that the interest it has generated will materialise over the coming months. During the last ten months, Chinese nationals have shown the most interest in this new law and the advantages it brings through the acquisition of real estate in our country.Stunning views of the Mediterranean sea Investments from China have increased by 600% during the first quarter of 2014, although we must take into account that the investment figure for the first quarter of 2013, upon which this comparison is based, was very low.

Amongst the factors which have enabled such a successful rise in Chinese interest in Spanish real estate investment, we must highlight the fact that prices have currently stabilised, following a decline which came as a result of the economic crisis in our country. Other key factors include: the quality of exclusive real estate in Spain, as well as its prime locations (such as exceptional areas along the Mediterranean, like the Costa Blanca, and large cities like Madrid and Valencia); the stability of the Spanish economy; a fiscal system which favours the foreign investor; an internationally-renowned healthcare system; and the high quality of life on offer, stemming from the country’s climate, gastronomy, geography, and rich historical and cultural heritage.

There are various reasons which lead to Chinese investors looking for investment abroad. Amongst these we can highlight the immediate availability of liquidity (also from businesses);Elegant terrace with views limitations to the general public when buying properties in China itself (acquiring real estate property is also a sign of social status for Chinese nationals); the desire to invest in assets which represent a safe bet, as is the case with luxury property (an example of real estate which promises a return on investment in the future); or the wish for these investors’ children to continue their studies in prestigious educational institutes. In this regard, it should be mentioned that Spain offers excellent colleges, universities and postgraduate training centres, including internationally-renowned business school, such as IESE and ESADE.

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