Chileans and Peruvians have joined the ranks of foreigners actively investing in Spanish property. Social, political and legal instability, which worsened sharply in these countries after left-wing forces came to power, together with high inflation and changes in the euro to US dollar exchange rate, prompted them to make large transactions in Spain.
To preserve their wealth, Chileans and Peruvians buy homes directly or through funds and companies in which they hold shares. Madrid and the Mediterranean coast are the regions where they invest the most.
Activity by buyers from these countries has been growing steadily since 2021, but the turning point came last year. According to the technology investment platform Inviertis, in 2022 10% of purchases were made with investors from Chile and Peru, without any special advertising campaigns aimed at them. A similar trend was seen earlier with Venezuela, Colombia and Mexico.
The main investors are owners of large family fortunes, who as a rule own the leading industrial groups in their countries. They see Spain as a “gateway” to European geographical diversification and monetary stability, since historically their investments outside their home countries were concentrated in the US and therefore tied to the dollar. South Americans no longer find as many opportunities on the US market, while Spain opens up new prospects for them and seems more accessible thanks to close cultural, social, economic and historical ties.
Besides the fact that Spain in general, and Madrid and Barcelona in particular, are a “bridge” between Latin America and Europe, lower property prices and higher returns compared with other countries on the European continent are also important. In addition, buying property worth €500,000 or more gives the right to a residence permit in Spain under the “Golden Visa” programme. The ease with which it is granted encourages them to increase their investment.
Chileans and Peruvians mostly buy property with their own funds, without taking out a mortgage. Most of them look for quality property in well-off areas of Madrid, Barcelona, Valencia or Málaga; in the Spanish capital, for example, they favour the Salamanca district. The climate, the food and drink, and the many leisure opportunities also matter to them.
As well as buying residential property, Chileans and Peruvians make deals in the retail sector, again mostly without a mortgage. They also invest in land, equity, businesses, debt and even the development sector, funding projects ranging from housing to hotels and logistics centres.
Despite the growing interest of Chilean and Peruvian nationals in Spanish property, their share of the market is still very small. Among Latin Americans, Mexicans, Venezuelans and Colombians remain more prominent, while the largest share of investment comes from the United Kingdom, Germany, France and the US.
