Euro Hitting Parity With US Dollar Presents Investor Migrants With A Unique Opportunity
20 July 2022
The Euro's continuing tumbling value has reached a historic point - it has become equal to the US Dollar (USD). The last time the Euro (EUR) matched the USD was in 2002. While this sudden dip in the EU’s main currency's value will undoubtedly have significant ramifications on the global economy, it does open the door to a unique opportunity for investor migrants. For those operating outside the Euro currency spectrum, Residency and Citizenship by Investment programmes in the EU have just become much more interesting and affordable.
The Greek, Irish, Portuguese, and Spanish Golden Visas all set their investment requirements in Euro, as do Malta's Exceptional Investor Naturalisation Programme (MEIN) and Malta Permanent Residence Programme (MPRP). The valuation of these programmes has remained constant during the Euro dip, but the true cost for those who have their wealth linked to the USD has fallen sharply.
For example, one year ago, the minimum real estate investment under the Portuguese Golden Visa was EUR 280,000 equaling USD 333,200. Today, that same investment option is set at USD 280,000 due to the Euro's value matching that of the USD. This is a saving of 16% for investors who maintain their funds in USD or any other currency pegged to the USD.
This economic phenomenon is highlighted in the Middle East region, as countries such as the UAE, Saudi Arabia, Qatar, Oman, Bahrain, Jordan, and Lebanon all have currencies pegged to the USD, which means even if investors hold their money in their home currency, they can take advantage of the sudden drop of the Euro, and subsequently the lower investment margins of the EU's golden visas.
A closer look at Europe's most popular citizenship or residency by investment programmes gives this opportunity greater context.
In Spain, for example, the minimum investment threshold is set at EUR 500,000, which is now the same in USD. The same investment one year ago was USD 595,000. Moreover, the housing market in Spain saw a year-on-year (YoY) increase in prices of 5.3%; however, that price increase is now negated by the rapid decrease of the Euro's value.
For Malta's MEIN programme, the minimum donation requirement of EUR 600,000 has gone down from USD 714,000 last year, allowing US investors to get EU citizenship at unprecedented cost savings.
If applicants invest now, while the Euro is still low, they can potentially make good returns should the Euro recover by the time the investment holding period is over, typically after 5 years. This is another good reason why investors are currently getting great value for their EU golden visa.
The current situation of the Euro is not expected to continue perpetually, as the EU will eventually take measures to address the issue, and the possible de-escalation of the war in Ukraine may prove to be a quick fix. Hence, investor migrants have a time-sensitive window of opportunity to take advantage of. By doing so, they can obtain EU citizenship or residence as well as an attractive ROI.
To learn more about EU citizenship and residency programmes, contact us today to book a free, comprehensive consultation with one of our experts.