In enabling this, the Spanish government is attempting to reinvigorate the property market by attracting foreigners from outside the European Union with the granting of a residence permit for investing in Spain, which brings the added benefit of being able to move virtually freely around various member states under the Schengen Agreement.
Here, too, there is a danger that an investor will view the purchase of a property as an opportunity to do business in Europe. This can mean that they fail to check sufficiently thoroughly as to whether the purchase of the property is safe and reputable, as they want to take advantage of the opportunity to gain legal residency in Spain. The risk is the same as for the tourist who wants to enjoy their holiday rather than attending meetings with lawyers. In this case, too, the investment is a means, not an end, for just as the tourist sees the acquisition of a property as a means that secures them their holiday in Spain, the entrepreneur sees their opportunity to obtain a residence permit by purchasing a property, which then enables them to move freely around the Schengen area. Both view getting adequate protection for their purchase as unnecessary. If any problems subsequently arise, they find themselves compelled to find a lawyer to solve the problems arising from their failure to seek independent, professional advice. However, by then it is often too late, and if there is a solution, it will involve much higher costs than if they had sought advice at the right time. Well-advised investors can avoid making such mistakes.
Carlos Prieto Cid – Lawyer