Move to Cyprus instead of Spain

Background

The latest information about a proposed 100% tax on non-EU residents is terrible news for those thinking of moving to Spain and those that already have.

What is going on?

It’s bad news for Non-EU residents dreaming of a holiday home or moving abroad, the Spanish government is pressing ahead with a plan to charge non-EU residents a 100% tax when they buy homes in the country. The move is intended to tackle a housing shortage in areas such as Madrid and Barcelona but will have an obvious impact in the main coastal areas where expats tend to live. The measure is part of a broader housing bill submitted to parliament last week, according to a copy of draft legislation seen by Bloomberg.

What’s causing this?

Public anger has been growing in Spain because locals have been priced out of homes by tourists and expats. Rents have been driven up by gentrification and landlords shifting to more lucrative, short-term tourist rentals, especially in urban and coastal areas.

What could be the impact?

The most obvious impact is on Non-EU residents looking to purchase a property in Spain.  Basically, purchasing a home is not going to be affordable and also highly risky based upon the difference between the overall purchase price and the likely selling price.

This will put off the vast majority of Non-EU residents thinking of moving to Spain.

Also, those that have already purchased property at the higher end of the market in popular expat areas are going to see a likely drop in their property value.  So this is bad news for all concerned.

Why is Cyprus a better option?

Moving to Spain is now looking like a high risk option.

Cyprus on the other hand is still encouraging migrants to move to the island through various incentives that include:

• Significant taxation benefits
• Residency aligned to property purchases

So, Cyprus is looking like a much better option than Spain at this time.  Of course, as the writer of this blog I’m biased, however I have previously lived in Spain and know the two countries very well.  Cyprus living and general lifestyle is an excellent choice for those looking to live in better weather and a more relaxed environment.

Schedule a call with us for more information about moving and living in Cyprus.