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Greek Golden Visa Giving Caribbean CBI a Run For Its Money Thanks to Euro-Dollar Parity

Georgaki and Partners Law Firm

The steep rise of the US Dollar against most global currencies in the last several months has put the Euro on par with the Dollar, a phenomenon not seen in 20 years. The drop is due to a variety of factors, such as Russia’s offensive against Ukraine, global inflation, and other geo-economic factors.

As is the rule in market movements, this drop brings misfortune to some while opening the doors of opportunity for others. It is the latter in the case of the Greek golden visa, as the residency by investment program has suddenly become as affordable as, if not more affordable than, the Caribbean citizenship by investment programs (CIPs).

The current pricing for the golden visa’s real estate option remains (at least for now) at EUR 250,000 but the benefit becomes clear when converted to the dollar, as it now equals US$247,426. The same option would equal US$296,649 exactly one year ago. 

This price decrease of about US$50,000 amounts to a staggering 16.5% discount for investors who hold their wealth in dolalrs or any of the many currencies pegged to it. 

For a family of four investing in real estate, the Greek Golden Visa now costs less than Dominica CIP

Consider a family of four – a main applicant, spouse, child aged 13, and child aged 20 – as an example. If they were to apply for the Greek golden visa, they would need a total outlay of EUR 262,264, consisting of the following:

  • A property investment of EUR 250,000;
  • Property transfer tax of 3.9% (EUR 9,750);
  • Application fees of EUR 2,000 for the main applicant and an additional EUR 150 per family member; and
  • A residence issuance fee of EUR 16 per person.

The total outlay would equal US$259,435. Now, let’s take a closer look at one of the Caribbean options:

Dominica’s program is one of the most affordable CIPs in the world and, while it has both a donation option and a real estate option, we will use the latter for comparison as it requires a similar investment. 

For the same family used in the previous example, the Dominican CIP would require a total investment of US$262,000, broken down as follows:

  • Investment and contribution: US$208,000;
  • Government due diligence fees: US$15,500;
  • Government due processing fees: US$1,000;
  • Government fees: US$35,000;
  • Government naturalization certificate fees: US$1,000;
  • Bank charges: US$300; and
  • Passport fees: US$1,200.

That the Greek golden visa is – in USD terms – about US$2,500 cheaper than the Dominican real estate option provides a unique opportunity for investors.

Far more upside potential in Greece

But there is one more factor that must be taken into consideration in terms of the overall cost. 

Under the Greek golden visa, 95.3% of the entire outlay goes into the investment itself. That is, 95.3% of the money can be recouped (or even make a profit).

Under Dominica’s CIP, only 79.3% of the cost goes towards the investment, while the remainders are non-refundable fees and payments that will never make their way back to the investor’s pocket. 

This analysis shows that the drop of the Euro coupled with the structuring of the golden visa has put it ahead of several of the most affordable investment migration programs globally in terms of economic viability.

But this favorable comparison doesn’t end there. 

The Greek golden visa’s policy of allowing investors to choose their assets from an open market opens a whole new door to profitability. They can create an entire real estate investment portfolio that allows them to choose properties that have high yield rates and, in a country that thrives on tourism and short-term rentals, the profit margin can be notable.

Add to that the appreciation of the principal asset as the housing market continues to grow, and the true gain of golden visa investors comes when if they sell their properties down the line, especially if the Euro recovers. The fluidity of the golden visa that allows investors to change their investments while maintaining their status is a critical factor to consider, as they can keep renting, selling, and buying properties to maximize their returns while perpetually holding on to their golden visas. 

This is a far cry from the Caribbean option, where an investor must choose one real estate option and stick to it for a specific holding period, then try to sell it to another investor. The uncomfortable truth is that investors in the Caribbean CIPs usually invest in resorts or hotels that are still funding their construction, and whether they will be able to deliver any ROI whatsoever during an investor’s holding period is far from a foregone conclusion.

The truth of the matter is that there is no arbitrage gain under the Caribbean CIPs, while annual ROI is at best unremarkable and at worst improbable. All of these factors contribute to the relative affordability of the Greek golden visa, and the decline of the Euro just makes it much more economical. 

If access to Europe is the main goal, Greek residence makes more sense than a Caribbean passport

While, on the face of it, pitting the Greek golden visa against the Caribbean CIPs is not a straight comparison, there is one vital issue to consider, which is what makes the Caribbean CIPs so popular in the first place. It comes down to two factors: Affordability and enhanced global mobility.

However, it is no secret that the main attraction of a Caribbean passport is its visa-free access to the EU, one which is never certain to remain, as evidenced by recent events in Vanuatu. The Greek golden visa boasts the same attribute – allowing its holder to access the EU visa-free – as well as the ability to reside in one of its most appealing countries.

Another important point is that EU residence permit holders are not required to apply for ETIAS to enter the EU, unlike their Caribbean passport holder counterparts. 

Thus, in essence, those looking at the Caribbean should consider the financial dimensions of the investment, and they should take a closer look at Greece’s golden visa and the current unique opportunity available to them.

To know more about the Greek golden visa, contact Georgaki & Partners through our website or email us directly at c.georgaki@georgakilawfirm.com