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Growth in real estate sales to foreigners

Posted by MCM Real Estate on 21.12.2022

Spain in general and Tenerife in particular, the Canary Islands today are still the most popular destination for real estate investment, despite the fact that now the procedure for buying an apartment or house in Tenerife for Russians, Ukrainians, Belarusians has become more complicated, it is still possible to carry out a deal, subject to certain conditions.

Growth in real estate sales to foreigners

Tenerife is an island with a rich historical heritage, excellent climate, as well as a large number of Blue Flag beaches, as always. is very popular with foreigners. Many of them invest in apartments and villas in the south of Tenerife.

According to studies, sales of real estate in Tenerife to foreign investors are growing, for example, in 2022 the share of foreigners when buying property in Tenerife was about 70% of the total market share. The most active buyers among foreigners are citizens of Italy, Germany, Poland, Belgium.

After the imposition of sanctions against Russia, Spain has become less accessible, both for tourist trips and for real estate investment.

What has changed for the citizens of Russia, Belarus

  • Many banks today do not open accounts for citizens of Russia and Belarus. However, there are banks that continue to cooperate with clients of both parties, provided that the client legally conducts business and can confirm the sources of his income. BBVA Bank works with Russians and Belarusians, you can open a current account and receive money from your country.

Opening an account is necessary to buy property in Spain. Settlements with the seller will go through the account, and further payment of taxes and utilities.

  • Some banks imposed restrictions on the replenishment of accounts previously opened by citizens of Russia and Belarus, which made it difficult to make mortgage and utility payments. However, as market experts emphasize, this happens every year to those who forget to provide financial documents to banks – income declarations!

Please note that Spanish banks require account holders to submit an annual income statement. As a rule, it must be prepared in February-March for the previous year. In order to avoid blocking the account, you need to prepare and translate this document in advance.

  • An important point, the rule is now in effect: Citizens of Russia and Belarus cannot have an amount exceeding 100,000 euros on their bank account balance. The cost of an apartment or house is almost always above this limit, so the payment to the real estate seller can be transferred in installments over several days or weeks, or you can use the account of the real estate agency.
  • Russians can transfer from a Russian account in an unsanctioned bank abroad to their own account or the account of another individual, an amount not exceeding $1 million or the equivalent in another currency.
  • At the moment, Spain is included in the list of “countries unfriendly to Russia”, payment to the account of an individual or legal entity may be blocked by a Russian bank, even if the Spanish side approves such a transfer, so we recommend making a transfer to your personal account.
  • It is difficult to get a mortgage if the income is only in rubles.

What has changed for the citizens of Ukraine?

  • Citizens of Ukraine today cannot transfer funds from their country to buy property in Spain, but it is possible to make a transfer from their accounts in other countries.
  • It is difficult to get a mortgage if the income is only in hryvnias.
  • Simplified process of obtaining a residence (residence permit) with the right to work up to 2 years
  • It is not difficult to open a checking account

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