Table of Contents
- Why Real Estate + Visas Are the New Go-To Strategy
- Portugal Golden Visa: The End of an Era and What Comes Next
- Spain Investment Visa: The Underrated Alternative
- ROI Analysis: Portugal vs. Spain Head-to-Head
- Tax Optimization: Where You Really Save
- Practical Implementation: Your Step-by-Step Roadmap
- Risks and Pitfalls: What Advisors Dont Tell You
- Outlook: Trends and Developments for 2025
- Frequently Asked Questions
Why Real Estate + Visas Are the New Gold Standard for Savvy Investors
Let me start with an observation I see every day in my consulting practice:
More and more clients are no longer just asking: Richard, where will I pay the lowest taxes? but rather: How can I combine a solid real estate investment with European residency?
There’s a good reason for that.
The days when you could consider flag theory in isolation are over. Today, you need an integrated strategy. One that combines your investment, your residence status, and your tax optimization in a single plan.
This is exactly where Portugal and Spain come into play.
The Three Pillars of an Intelligent Investment Visa Strategy
Before we get into detail, let me break down the three pillars of a successful approach:
- Return on Investment (ROI): Your property investment must pay off—regardless of the visa aspect.
- Legal Security: Your residence status must be plannable and renewable in the long term.
- Tax Optimization: The overall structure should reduce your tax burden—not increase it.
Makes sense? It is. Still, I see investors every day neglecting one or more of these pillars.
Portugal vs. Spain: Why These Two Countries?
The answer is simpler than you think:
First: Both countries offer established investment visa programs with EU access. That means you’re not just investing in one country—you get access to all 27 EU member states.
Second: The property markets are mature enough for professional investments, but not overheated like in Germany or Switzerland.
Third: Both countries offer attractive tax regimes for foreigners—if you set things up correctly.
But here’s where it gets interesting: The details differ significantly. And these details are what will make or break your strategy.
Portugal Golden Visa 2025: The End of an Era and New Opportunities
Let me get straight to the biggest change:
The classic Portugal Golden Visa for properties in Lisbon and Porto is history since October 2023. Done. Over and out.
But—and this is the important but—the program isn’t dead. It’s just changed.
What Still Works with the Portugal Golden Visa
Here are the current options for 2025:
- Property in the Azores and Madeira: Minimum investment of €500,000 (€280,000 for renovation projects)
- Property in inland Portugal: Same investment amounts, significantly lower prices
- Investment Funds: €500,000 in approved funds
- Starting a Business: Creation of at least 10 jobs
- Art and Culture: €250,000 in cultural projects
Now you’re probably asking: Which option makes sense for me?
ROI Potential: Azores vs. Inland Portugal
Here’s where it gets interesting. Most advisors only tell you half the story.
Region | Average Price/sqm | Rental Yield p.a. | Value Gain (5 Years) | Liquidity |
---|---|---|---|---|
Azores | €1,200–2,000 | 4–6% | 15–25% | Low |
Inland | €800–1,500 | 6–8% | 20–35% | Medium |
Madeira | €2,000–3,500 | 3–5% | 10–20% | High |
What does this mean for your strategy?
If you’re aiming for cash flow: Inland Portugal is your ally. Cities like Coimbra, Braga or Aveiro offer solid rental yields at moderate entry prices.
If you’re betting on value appreciation: The Azores or select inland regions with development potential.
If you need liquidity: Madeira, even if the yields are lower.
The Hidden Costs of the Portugal Golden Visa
Let me bust a myth I hear daily:
The Portugal Golden Visa only costs the investment sum.
Wrong. Dead wrong.
Expect these additional costs:
- Application fees: €5,320 for the main applicant, €2,660 per family member
- Legal fees: €15,000–25,000 for full processing
- Due Diligence: €3,000–5,000 per person
- Annual renewal: €2,660 every two years
- Property tax (IMI): 0.3–0.8% of property value yearly
- Transfer tax (IMT): Up to 8% of the purchase price
That quickly adds up to €50,000–80,000 in extra costs for a €500,000 investment. You need to factor these into your ROI calculation.
Residency Requirements: What You Really Have to Meet
Here’s the good news: Portugal is relaxed.
You only need to spend 7 days in Portugal in the first two years, then 14 days every two years after that. So just about one week per year.
Perfect if you’re a digitally nomadic entrepreneur, right?
After five years, you can apply for permanent residency. After six years, even Portuguese citizenship—provided you speak Portuguese at an A2 level.
Spain Investment Visa: The Underrated Alternative with Surprising Potential
While everyone’s looking at Portugal, many overlook the Spanish option. Yet Spain offers very compelling opportunities.
But—and I say this as someone who knows both systems—Spain is more complicated. Not worse, but definitely more complex.
An Overview of Spain’s Investment Visa Options
Spain offers several routes to residency by investment:
- Real estate investment: At least €500,000
- Government bonds: €2 million
- Business participation: €1 million
- Bank deposits: €1 million
- New business foundation: From €40,000 with a business plan
For most of my clients, the real estate route is the most attractive. Ill focus on that.
Spain Real Estate ROI: Where the Action Is
This is where it gets really interesting. Spain isn’t just Spain—the regional differences are even greater than in Portugal:
Region | Ø Price/sqm | Rental Yield | Value Increase (3 years) | Visa Acceptance |
---|---|---|---|---|
Madrid Center | €4,500–7,000 | 3–4% | 15–20% | High |
Barcelona | €3,800–6,500 | 3–5% | 10–15% | High |
Valencia | €1,800–3,200 | 5–7% | 20–30% | High |
Costa del Sol | €2,200–4,500 | 4–6% | 8–15% | Medium |
Canary Islands | €1,500–3,000 | 6–8% | 12–18% | High |
My recommendation? Valencia is currently the sweet spot.
Why? Simple:
- Moderate entry prices with high appreciation potential
- Solid rental yields due to strong demand
- Excellent infrastructure and quality of life
- No tourist tax like on the Balearic Islands
The Crucial Difference: Residency Requirements in Spain
This is Spain’s sticking point:
Unlike Portugal, Spain requires actual presence. You must spend at least 183 days per year in Spain to qualify as a tax resident.
That’s a real game-changer for digital nomad entrepreneurs.
Theres a conflict: On one hand, you want to stay flexible; on the other, the Spanish system forces you to become settled.
But—and here’s where my experience counts—there are legal workarounds.
Spain Non-Lucrative Visa: The Secret Weapon for Retirees and Passive Investors
Here’s an option many overlook:
Spain’s Non-Lucrative Visa targets those who can support their lifestyle in Spain without employment.
The requirements:
- Proof of €27,115 annual passive income
- Plus €6,779 per family member
- Health insurance
- Clean criminal record
The advantage: No need to invest €500,000. The downside: You can’t work in Spain.
For passive-income investors, this can be more attractive than the investment visa.
ROI Analysis Portugal vs. Spain: The Cold, Hard Numbers
Now let’s get concrete. Let’s look at the numbers.
Ill run you through two realistic scenarios—with all costs, nothing sugarcoated.
Scenario 1: Inland Portugal (€500,000 Investment)
Let’s assume you buy a renovated property in Coimbra for €500,000:
Cost Item | Year 1 | Year 2–5 (per year) | 5-Year Total |
---|---|---|---|
Purchase Price | €500,000 | – | €500,000 |
Purchase Ancillary Costs | €65,000 | – | €65,000 |
Visa Costs | €25,000 | €1,330 | €30,320 |
Rental Income | –€30,000 | –€30,000 | –€150,000 |
Operating Costs | €8,000 | €8,200 | €40,800 |
Value Appreciation | – | – | –€125,000 |
Total profit after 5 years: €139,880 gain on a total investment of €590,000 = 23.7% or 4.3% p.a.
Scenario 2: Valencia, Spain (€500,000 Investment)
Same investment, city center of Valencia:
Cost Item | Year 1 | Year 2–5 (per year) | 5-Year Total |
---|---|---|---|
Purchase Price | €500,000 | – | €500,000 |
Purchase Ancillary Costs | €55,000 | – | €55,000 |
Visa Costs | €15,000 | €2,000 | €23,000 |
Rental Income | –€25,000 | –€26,000 | –€129,000 |
Operating Costs | €6,000 | €6,200 | €30,800 |
Value Appreciation | – | – | –€100,000 |
Total profit after 5 years: €120,200 gain on a total investment of €570,000 = 21.1% or 3.9% p.a.
What These Numbers Really Mean
At first glance, Portugal wins by a nose. But look closer:
Portugal scores with:
- Higher overall return due to better value appreciation
- Lower residency requirements
- Easier visa renewal
Spain scores with:
- Lower ancillary purchase costs
- Greater property liquidity
- Better infrastructure and quality of life
The key insight: Looking at ROI alone is misleading.
Why? Because you haven’t factored in the tax aspects yet.
Hidden Champion: The Power of Combining Both
Here’s my insider tip from the field:
Combine both approaches. Use Portugal for the residency permit and invest in additional Spanish real estate without the visa obligation.
That gives you:
- EU residency rights without high presence requirements
- Diversification across two markets
- Tax optimization through smart structuring
Sounds complicated? It is. But the results make it worthwhile.
Tax Optimization: Where You Really Save (and Where You Don’t)
This is where it gets to the heart of things. Without tax optimization, even the best ROI fizzles out.
But be careful: This is where most traps lie. And where I hear the most half-truths from colleagues.
Portugal NHR: That’s History
Let me clear up a widespread myth:
The Portuguese NHR program (Non-Habitual Resident) for new arrivals is history since 2023. Done. Over.
If anyone is still selling you NHR today, they’re either misinformed or leading you astray on purpose.
The current situation in Portugal:
- Regular Portuguese income tax: 14.5% to 48%
- Net wealth tax: 0.4% to 1% from €600,000 upwards
- Capital gains tax: 28%
- Inheritance tax: 0% to 40% depending on relationship
That’s not bad, but it’s not spectacular either.
Spain’s Beckham Law: Still an Option for High Earners
This gets more interesting:
Spain’s Beckham Law is still in force. Foreigners can opt for a flat 24% tax on Spanish income for the first six years—no matter how high the income.
Foreign income stays tax-free as long as it’s not transferred to Spain.
This is attractive for entrepreneurs with high non-Spanish income streams.
Requirements:
- You must not have been a Spanish tax resident in the last 10 years
- You become a Spanish tax resident due to employment
- Your work is actually performed in Spain
The catch: As an entrepreneur, you must prove you “work”—pure capital income is not enough.
The Dubai Combination: Where It Gets Really Interesting
Now to the strategy I recommend to many of my clients:
Use Portugal or Spain for your EU residence permit. Set up your operational base in Dubai.
Why does this work?
- Portugal: Residency requirement only 7 days/year
- Dubai: No income tax with proper structuring
- EU access: Move back into the EU at any time
The structure works as follows:
Element | Purpose | Tax Treatment |
---|---|---|
Dubai Freezone LLC | Business activity | 0% corporate tax |
UAE Residence Visa | Tax residence | 0% income tax |
Portugal Golden Visa | EU backup & investment | Only on Portuguese income |
The beauty: You meet the residency requirements in both countries and minimize your tax burden—legally.
But Beware: German Pitfalls
If you’re a German citizen, pay particular attention:
Exit tax: For shareholdings over 1% or stakes above €500,000, the German tax office comes knocking—even if you’ve left the country.
CFC Rules: Germany’s controlled foreign company rules can undermine your Dubai structure if you don’t strictly meet the 183-day rule.
Double taxation agreements: The tie-breaker rules decide your tax residence.
My advice: Plan at least 12 months ahead and document everything meticulously.
Swiss and Austrian Clients: Your Specifics
A quick note for my Swiss and Austrian clients:
Switzerland: Reclaiming withholding tax can get complicated. Allow for 6–12 months of processing time.
Austria: The 183-day rule is stricter than in Germany. Record your travel precisely.
In both cases, proper deregistration is worth its weight in gold.
Practical Implementation: Your Step-by-Step Roadmap
Enough theory. Let’s get practical.
Here’s the roadmap I run through with my clients—step by step, no detours:
Phase 1: Strategic Decision (Months 1–2)
Step 1: Take Stock
- Assess your current tax burden
- Clarify marital status and dependencies
- Check liquid funds and financing options
- Analyze business model for international suitability
Step 2: Choose a Target Country
Here’s the decision matrix I use:
Criterion | Portugal | Spain | Weighting |
---|---|---|---|
Residency Requirement | ★★★★★ | ★★☆☆☆ | High |
ROI Potential | ★★★★☆ | ★★★☆☆ | High |
Tax Optimization | ★★★☆☆ | ★★★★☆ | Very High |
Quality of Life | ★★★★☆ | ★★★★★ | Medium |
Legal Security | ★★★★★ | ★★★★☆ | Very High |
Step 3: Finalize Your Budget
Expect the following overall costs for your first year:
- Portugal: €590,000–650,000
- Spain: €570,000–620,000
- Combination: €850,000–1,000,000
Phase 2: Due Diligence and Preparation (Months 3–4)
Document gathering (crucial!):
- Apostilled birth and marriage certificates
- Criminal background check (apostilled)
- Proof of liquid funds (bank statements from past 6 months)
- Proof of income for the last 3 years
- Health insurance certificate
- Commercial register extracts for all holdings
Pro tip: Request all apostilles at the same time. Saves time and nerves.
Choosing a Lawyer:
Don’t cut corners here by choosing the cheapest. Look for:
- Specialization in investment visas
- German-speaking support
- References from other clients
- Transparent fee structure
Phase 3: Property Search & Purchase (Months 5–8)
Property Due Diligence Checklist:
- Check the energy certificate (mandatory in both countries)
- Study the land registry extract carefully
- Inspect building permits and plans
- Review rental contracts for leased properties
- Check homeowners association fees and operating costs of last 3 years
- Obtain an independent experts appraisal
In my experience: Don’t let anyone rush you. There are plenty of properties on the market.
Financing (if desired):
Yes, you can get loans as a foreigner:
- Portugal: Up to 70% LTV with good credit
- Spain: Up to 60% LTV as a non-resident
- Interest rates: Currently 4–6% depending on duration
The advantage: You leverage your return. The downside: More complexity in the visa process.
Phase 4: Visa Application (Months 9–12)
Portugal Golden Visa Timeline:
- Conclude property purchase (Month 9)
- Submit application to SEF (Month 10)
- Biometric data collection in Portugal (Month 11)
- Pick up visa card (Month 12–14)
Spain Investment Visa Timeline:
- Conclude property purchase (Month 9)
- Apply via Spanish consulate (Month 10)
- Enter country and apply for residence permit (Month 11)
- Receive NIE and TIE (Month 12–13)
Important: Build in generous buffers. Government offices run on their own timelines.
Phase 5: Tax Structuring (from Month 6)
Parallel to property search, set up your tax structure:
If you choose the Dubai combination:
- Set up Dubai Freezone LLC
- Apply for UAE residence visa
- Apply for Emirates ID
- Open a bank account in the UAE
- Prepare deregistration in Germany
Timing matters:
Only deregister for tax purposes after all other elements are in place. Otherwise, gaps may arise that the revenue office can exploit.
Risks and Pitfalls: What Advisors Won’t Tell You
This is where it gets uncomfortable. Because I’ll tell you what others won’t.
After ten years in this business, Ive seen all the mistakes. Some cost money, some cost years—some cost both.
Pitfall #1: The Burden of Proof Shift
The biggest risk is what you don’t see:
The German tax office doesn’t have to prove you’re taxable in Germany. You have to prove you’re not.
Sound unfair? It is. But that’s how the system works.
What this means for you:
- Document every day you spend abroad
- Keep records for all expenses abroad
- Maintain a residency and activity log
- Photograph key appointments with a timestamp
I know, it sounds paranoid. But a tax audit is no joke.
Pitfall #2: The Property Trap
Here’s a mistake I see far too often:
Investors buy a property that qualifies for the visa program, but is a financial disaster.
Property red flags:
- Unrealistically high yield promises (over 8% in Europe)
- Properties in remote fringe locations
- Units built solely for visa programs
- No comparable sales in the area
- Seller pushing for a rushed decision
My rule: Would you buy the property without the visa program? If not, leave it.
Pitfall #3: The Family Trap
This gets particularly tricky with families:
You get your visa, but your spouse and kids are still taxed in Germany—because their center of life remains there.
The consequences:
- Splitting tax rate gone
- No more child allowance
- Double health insurance
- Complicated tax returns in multiple countries
The solution: Either all in, or none. Half measures don’t work.
Pitfall #4: The Liquidity Trap
An underrated risk:
You tie up €500,000 in real estate and suddenly have a liquidity problem.
What happens if:
- Your business hits a cash flow squeeze?
- You need money urgently for a new opportunity?
- The property sits empty longer than expected?
- Major repairs are needed?
My rule: Keep at least 12 months of living expenses in reserve.
Pitfall #5: The Visa Renewal Trap
This is where it gets really expensive:
Portugal and Spain can change their visa programs at any time. Your acquired rights are only partially protected.
What’s already happened:
- Portugal removed Lisbon and Porto from the program
- Residency requirements tightened
- Due diligence checks became tougher
What could still come:
- Increased minimum investment amounts
- Tougher residency requirements
- Complete freeze on new applications
Always plan for a Plan B.
Pitfall #6: The Tax Advisor Trap
The most expensive mistake often comes from those meant to help:
Many German tax advisors have little experience with international structures. Yet they still give advice—usually the wrong kind.
Advisor red flags:
- We’ve always done it this way
- No specific references
- One-size-fits-all solutions without individual analysis
- Promises with no risk assessment
- No cooperation with local experts
My advice: Always get a second opinion. Even mine.
Outlook 2025: What’s Changing and How to Prepare
I’ll be honest with you:
The golden age of investment visas is over. What remains is getting pricier, more complicated, and more regulated.
But—and this matters—it’s not worse. Just different.
Portugal 2025: The New Rules
Portugal is steadily tightening requirements:
What’s already changed:
- Minimum stay: From 7 to 14 days in the first two years
- Language test: A2 Portuguese becomes mandatory for renewal
- Due diligence: Tougher money laundering checks
- Geographical limitations: Only Azores, Madeira, and inland now
Expected in 2025:
- Increase of minimum investment to €750,000 (my forecast)
- Stricter residency requirements
- Limited annual new visa quotas
- Higher processing fees
My advice: If you’re considering Portugal, act now. The window is closing.
Spain 2025: The Beckham Alternative
Spain is going a different route:
Instead of making investment visas harder, Spain focuses on highly qualified foreigners and entrepreneurs.
New developments:
- Digital Nomad Visa for remote workers
- Startup Visa for innovative businesses
- Simplified procedures for EU citizens
- More attractive tax models for expats
This makes Spain more appealing for entrepreneurs seeking more than passive investment.
The Big Trend: OECD Clamps Down
This is the game-changer:
OECD is tightening global tax rules, hitting investment visa programs as well.
What’s happening concretely:
- Automatic exchange of information between all EU countries
- Stricter substance requirements for businesses
- CRS reporting will also include real estate
- EU-wide anti-money laundering guidelines
Bottom line: Hiding is impossible. Transparency is mandatory.
The Dubai Alternative Gains Momentum
This is the direction many of my clients are moving toward:
Dubai still offers real tax advantages with solid legal certainty. Combined with an EU visa, you get the best of both worlds.
Why Dubai becomes more attractive in 2025:
- New freezone options for small businesses
- Simplified visa processes
- Better banking options for foreigners
- Political stability
The trend is toward a multi-country strategy: EU residency plus tax-optimized home base.
New Players Entering the Market
Look beyond the obvious choices:
Attractive alternatives for 2025:
- Malta: New investment program in the works
- Greece: Golden Visa will be reformed, not canceled
- Italy: New entrepreneur visa options
- Cyprus: Making a comeback post-reform
Diversification is more crucial than ever. One country is no longer enough.
My Forecast for 2030
Let me gaze into the crystal ball:
In five years, there will be two types of investment visas:
- Premium Programs: Very high investment amounts (€1+ million), but real advantages
- Entrepreneur Programs: Lower amounts, but genuine business activity required
Passive investments will become less attractive. Active entrepreneurship will be rewarded.
Prepare yourself accordingly.
Frequently Asked Questions
Can I use both programs at the same time?
Yes, in principle you can invest in both Portugal and Spain. But it only makes sense if the double costs are justified by the benefits. You must still meet the residence requirements in both countries.
What happens with Brexit—am I affected as an EU citizen?
Brexit only applies to British citizens. As a German, Austrian, or Swiss citizen, you still retain all EU rights. The Portugal and Spain investment visas give you additional local residency rights.
Do I have to use the property myself?
No, in both programs you are allowed to rent out the property. But—make sure you pay taxes on rental income in both countries, and document all earnings properly.
How long does the whole process really take?
Plan on 12–18 months from first consultation to receiving your visa card. Portugal tends to be slower than Spain, but both countries struggle with delays. Build in generous time buffers.
What happens if the laws change?
Acquired rights are generally protected, but renewal requirements can change. Portugal has already tightened requirements repeatedly. Always have a Plan B and keep monitoring for changes.
Can I include my family?
Yes, both programs allow you to include spouses and minor children. Adult children are sometimes possible under certain conditions. Costs increase accordingly—plan on €2,000–5,000 per additional person.
Do I really need a lawyer?
Theoretically you could submit both applications yourself. Realistically, it’s not advisable. The error rate is high, correcting mistakes is costly and time-consuming. A specialized lawyer pays for themselves through time saved and risk minimized.
What’s the risk of a rejection?
If well prepared, the risk is low. Portugal has a rejection rate of about 5%, Spain about 8–10%. The most common causes are incomplete documents or problems with the background check.
Can I sell the property after citizenship?
It depends on the program. Portugal allows a sale after citizenship is granted. Spain has stricter rules—plan to wait at least 10 years. Always check the latest rules before selling.
What are the ongoing costs after getting the visa?
In addition to property costs (taxes, insurance, maintenance), there are visa renewal fees: Portugal €2,660 every two years, Spain around €1,000 annually. Add lawyer fees for renewals and any translation costs.
—
Want a personalized analysis of your situation? As your tax mentor, I’ll help you find the optimal combination of investment, residency, and tax optimization. Contact me for a no-obligation initial consultation.
Yours, RMS