Proclaiming that “too many Airbnbs” have led to a housing crisis, Spain’s prime minister said he wants to implement a slew of new policies that includes a tax of up to 100% on homes purchased by buyers outside of the European Union.
“What’s lacking is housing,” Prime Minister Pedro Sánchez said Monday, adding that some 27,000 homes and apartments in the country were purchased by non-EU residents last year. Many of those, he said, are not purchased with the intent for the buyer to live in them, but rather to rent out on platforms like Airbnb, to the detriment of the local community.
“The West faces a decisive challenge,” he continued. “To not become a society divided into two classes, the rich landlords and poor tenants.”
The remarks come as multiple countries in Europe that have become popular “golden visa” destinations face stark realities in recent years: With rich foreigners pouring in, local housing markets have been adversely affected.
Spain has already made moves to wind down its golden visa program later this year. The program was devised in the aftermath of Europe’s 2012 debt crisis to allow rich foreigners to invest in real estate as one avenue toward attaining residency and eventually citizenship in the country. The programs, which popped up across the continent, succeeded in attracting capital, but may also have been too successful—real estate prices in city centers like Barcelona and Lisbon have surged, making both renting and buying housing unaffordable for many locals. Spain faces a severe housing shortage.
Spain’s program, in particular, was attractive because of the relatively low cost of investment: For 500,000 euros, Americans and other wealthy buyers—many of them Chinese and Russian nationals—could buy property, gain residency, and have the ability to live, work, and study in the country freely.
In addition to Spain, Portugal and Greece have also seen explosive growth with similar programs; Portugal responded in 2023 by eliminating real estate as an investment option. Ireland also shut down a similar program the same year. These countries are ultra attractive because gaining citizenship in them means easier access to all EU countries; investors may start in Portugal, for example, but if they become citizens, they can relocate to any EU member state. And residency in Spain means they also have the right to visa-free travel within the Schengen Area, which includes most of the EU.
Rising housing costs isn’t the only potential problem related to these programs; concerns about money laundering also abound.
Spain’s new policies have not been finalized yet, and the Prime Minister did not divulge many more details about how they would be implemented. He nodded to similar policies in countries like Canada and Denmark. Some localities in Spain have already taken steps to ban short-terms rentals.
While investors from China and Russia are the most common, Americans have also been flocking to the countries in recent years, attracted by the comparatively low cost of living, social services, and beautiful scenery. In June 2024, there were around 41,000 Americans living in Spain, a 39% jump from just three years prior, according to Bloomberg.
Where Americans will go instead
While countries like Spain and Portugal tighten or eliminate their residency by investment programs, other locales are happy to take their place.
Greece has faced similar housing market difficulties to Portugal and Spain and has tightened some requirements as a result. But the country has seen increased interest from foreign buyers in the past few months, according to an analysis from Astons, an investment immigration and relocation company.
The minimum investment for Greece’s golden visa is just under $265,000, and applications are often processed in a few months, according to Astons. Other popular destinations for the American expat include Costa Rica, Italy, and France.
And while Portugal eliminated the real estate investment route, foreigners can still invest in some funds and qualify. While that doesn’t get you a place to live—one of the attractive parts of the real estate investment—it can still get you residency.
Are you an American living abroad? Fortunesenior writer Alicia Adamczyk would like to interview you about your decision. Email her at alicia.adamczyk@fortune.com.