Spain has recently passed a legislation that gives automatic residency to those who spend more than 500,000 euros on a property.
“They’ve been talking about this legislation for a while and finally it was promulgated about two to three months ago. It now enabled foreigners, non-Spanish citizens, to acquire property in Spain for a minimum of 500,000 euros,” Pam Golding International managing director Chris Immelman told CNBC Africa.
“It will then entitle such a purchaser to residency in Spain, which gives you automatic Schengen visa rights, which is obviously quite attractive to South Africans and others.”
Immelman added that the legislation would significantly increase appetite for investment from South Africa, and would also strengthen the prospect of Spain becoming a frequent holiday destination.
“The residency component in Spain is just so much more attractive because it does give you access to Europe via the Schengen visa. The appetite has been good. We’ve tested it just recently in the market and we’ve got really strong response from it. The challenge for us is to not only try find a property in Spain but to make sure that we find you a decent yielding property.”
Pam Golding has additionally set up associations with Spanish real estate companies, lawyers and other tax structuring companies to enable buyers to make smooth transactions, and find property with formidable integrity and that yield good returns.
Immelman added that regulation is not much of an impediment when making a transaction between South Africa and Spain. This is as long the South African Reserve Bank’s threshold is when moving a significant amount of money from South Africa to another country.
Apart from Spain, the London property market continues to grow as a favoured property market for South Africans.
“Our stronghold has always been London. The Pam Golding group has done an enormous amount of London sales to South Africans. The London market continues to be the favourite among South Africans to purchase,” Immelman explained.
“We’ve set up associations in the rest of Europe, particularly in Italy and France, but that’s not necessarily to sell South African properties. Our associations there have been strong in us selling Mauritius and Seychelles property particularly to the French and Italian.”
While there have been rumours of a property bubble in London, Southwest London remains a key property market for Pam Golding and its South African clients.
“If we see the influx of people wanting to live in London, it’s going to fuel that market all the time. We see London as an economy on its own and therefore we certainly don’t see it correcting any time soon,” said Immelman.