Christina Georgaki of Georgaki & Partners
IMI Official Partner
The anti-investment immigration media has been having a field day, or, more accurately, a field year, during 2023.
The “end of golden visas” is the main theme, and anyone working in the business will have been flooded by questions from their staff, partners, clients, and anyone else who knows anything about investment migration. The top question we’ve been getting may be the most ridiculous: Is investment migration ending?
In short, no, it is not ending. In fact, it is thriving. This year is on track to be a record one for the Golden Visas of Greece, Portugal, Malta, and Italy.
Applications for Italy’s Golden Visa continue to climb consistently, and 2022 registered a fascinating jump in the number of applications, growing 125% YoY.
Some may argue that the increase in applications under the Greek and Portugal Golden Visas is primarily due to the changes in their respective laws.
This theory is partially true, as any upward change in pricing under any investment migration program always induces a rush of applications. Still, the truth of the matter is not that simple.
Yes, some investors who would be priced out of the Golden Visa may rush to get their applications in, but in my experience, those investors are a small minority, especially for investment migration programs in Europe, as those with a lower budget often opt for cheaper programs such as those in the Caribbean or the Pacific.
The primary drivers for this rush are investment migration consultancy firms, who use the upcoming changes to start a marketing frenzy and push investors who were considering the matter or about to invest but got cold feet to sign a contract and submit their files.
People love a deal, and investment migration firms spin these price hike announcements into a last-chance-saloon situation where it is now or never.
This isn’t true, especially for the Greek Golden Visa, where the minimum investment amount of €250,000 remains valid in the vast majority of the country. Highly desirable investment areas remain at the lower price point. Ioannina, one of Greece’s largest and most stunning cities, offers excellent value for money, while the islands of Corfu and Crete are excellent investment destinations in their own right. However, they usually go unnoticed because outsider firms do not understand the value and potential of these areas as investment destinations, which is a pity since they offer great returns and remarkable real estate options.
Investment migration firms do this, however, to close more sales in the short term, not considering that they are subconsciously branding the programs as “bad” or “too expensive” once the changes come into effect, which also isn’t the case at all.
The Golden Visas will remain an attractive option for HNWIs, no matter what. They are the simplest route to obtaining residency within the EU, and even if the price or investment categories change, the demand will still be there.
Consider Ireland’s Immigrant Investor Program (IIP), which required an investment of €1 million, or Spain’s Golden Visa (which was historically typically pricier than its counterparts), which requires a €500,000 real estate investment. Both programs have seen massive success, a testament that if a Golden Visa exists, investors will apply.
If you look across the pond, the EB5, which requires an investment of $800,000 to be at risk, continues to attract massive interest, so the truth is that a bump in pricing or a change of asset are not enough to derail a Golden Visa.
However, the media is still ringing its bell, declaring the end nigh, but you should cancel out this noise, as it has no real substance.
A Political Tool
The media loves bashing investment migration, which is no surprise; it is an easy target.
Some media outlets do this more than others, and those with an agenda use the slightest of issues to make a splash. Investment migration, of course, is not without its faults, like any other industry in the world, but the media seems to only look at the few, bad incidents and use them as a whipping stick.
So why does the media do that? Well, again, there are two reasons, a benign one and a serious one.
The first reason is simple: Drama. Scandals concerning the rich make for excellent clickbait. Online media lives on clicks, so it makes sense for them to give the public the drama they crave.
The second issue is more sinister because it doesn’t stem directly from the media but from politicians.
The EU’s stance against Golden Visas, which inject its economy with substantial amounts of unencumbered FDI, is notoriously demonstrated.
Many EU officials have spoken out against Golden Visas, highlighting seemingly serious security gaps, which isn’t the case as Golden Visa due diligence is a complex and comprehensive process. Nonetheless, politicians in the EU, and the UK for that matter, have continued to besmirch investment migration, and that trend has increased in 2023.
The reason behind this is because investment migration is an easy target, one that can rile up the voting base. HNWIs are a voting minority, so if a politician wants a PC policy to base his or her campaign on, investment migration makes for a solid scapegoat.
Unlike attacking all immigrants, which resonates with extremists on a geopolitical and racial level, investment migration targets the rich, playing on the socioeconomic echelon.
Since the majority of the voters are not wealthy, it is easy, and (wrongly) acceptable to the public, to attack rich immigrants. This provides politicians with an angle that resonates with the voters and riles them up enough to make some noise without being put in a precarious situation.
The media eventually picks up on this and blows everything out of proportion. But all of this is just hollow noise; Golden Visas are here to stay. They may change, they may get more expensive or more affordable, but they are not going anywhere anytime soon.
Too Important To Close
Golden Visas were created as a response to the 2008-2009 financial crisis, and they’ve done their job well. However, that doesn’t mean that they are done, nor that they should have a timer on them.
Foreign investment in real estate within Greece makes up for 25-35% of all FDI, a massive amount on any scale. The foreign demand for Greek real estate didn’t pick up until the Golden Visa was introduced, and in 2022, 80% of all property sales in Greece were done by foreign buyers.
Greece cannot afford to close down the Golden Visa. It is not purely economically reliant on it, but it does offer a significant boost to the economy.
The Golden Visas were a response to a global financial crisis, and now, as the world is about to witness another major crisis as inflation is reaching unprecedented levels, it makes no sense for countries to shut down one of their most efficient economic solutions.
Golden Visas also offer much more than just direct FDI. They create thousands of jobs and stimulate supporting manufacturing, product, and service sectors while boosting smaller businesses that thrive on investment migration’s niche market.
The true economic effect of a Golden Visa is too wide and complex to be measured, and the cost of shutting it down would be much higher than these unmindful politicians assume.
Thankfully, the ones making all the noise don’t make all the decisions, and as we say in Portugal, when the investment migration industry people made their points to Parliament, sound reasoning can prevail, and keeping Golden Visas is only logical.
Golden Visas are marketed as a beneficial venture for investors, which they are indeed, but they are also extremely beneficial and crucial for governments, especially in times of economic uncertainty.
I have personally seen an uptick of 40% in inquiries during this year, and the demand is still growing. It isn’t a matter of rushing in an application before the price hike comes into effect (which it already has earlier this month), but rather a greater awareness among HNWIs regarding the benefits of the Golden Visa.
Greece itself remains an investment magnet. Of those increased inquiries, I continue to see massive demand for investment in Thessaloniki, one of the areas where the price hike is in effect. Although at a higher price point, Thessaloniki offers an excellent investment environment in one of Europe’s most dynamic cities.
It is home to the largest population in the Balkan area and houses Piraeus’ Port, the largest in Greece and one of the largest in Europe. Thessaloniki’s dynamic market has transformed it into an economic hub, as highlighted by companies such as Pfizer and Delliote situating HQs in the city. It is one of the best areas to invest in, not just in Greece, but in Europe, and savvy investors who do their research quickly come to this conclusion.
Hence, Greece offers something else. Something better. A Golden Visa program coupled with an investment that actually makes sense, and that is precisely why the demand continues to grow.
The wealthy will always look for ways to improve their lives, and the Golden Visa is the best way to do so, and that is precisely why investment migration isn’t going anywhere.
Mark my words: instead of worrying about Golden Visas and whether they will survive, prepare yourself for them to thrive. They are too important to fall, and everyone who gives the matter a minute of thought will agree.