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Comment by louison11 | Hacker News Reader

I'm not saying it has zero effect. I'm saying it's a misdirected effort that would cause them more harm than good. Spain isn't exactly in the fittest economic position. It needs to attract foreigners to cultivate its growth - hence their Beckham law and other benefits for foreigners. You can deter people from coming and see the country stagnate/go down, or you can actually match the demand and foreign dynamism, and use that as an opportunity for the whole place to grow and modernize.

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This is a quick "fix" that has a lot of unintended consequences. I've seen it first hand and the only people it benefits are those who are already wealthy. Everyone else gets a lot poorer as their cost of living skyrockets. Homelessness explodes as rents and housing costs increase dramatically, people who were living a humble but decent life before are pushed into poverty, crime both non-violent and violent increases and so does drug use. As far as I can tell the only people that actually benefit from this scheme are landlords and housing developers who slow walk their projects so that they can charge the maximum price per unit. Compared to the previous fairly stable state (which you call stagnation) the locals are much worse off. It also tends to ruin the character of places that were previously seen as a vacation destination for a unique experience, all of that just gets paved over and turned into a bland tourist trap barely different from any other place. Count yourself lucky if you live somewhere that has been passed over by this horrid money making scheme.

How does allowing *non-residents* to buy real estate help in attracting foreigners and cultivate growth?

Money invested from abroad is money coming inside the economy - whether the person lives there or not. That money goes to the seller, who'll then get taxed on it, spend it somewhere else... Or that money could be used, as I said, to build new buildings and rehabilitate old ones, thus creating jobs in the process. If the system was well set up for it, foreigners investing in a country is usually a good thing. The US is super foreign-investment friendly for example, doesn't hurt them.

Besides, if foreigners are investing solely to speculate - if they did fix the supply constraints, the opportunity for speculation would greatly decrease. It's only an attractive investment because the supply is so finite.

Alternatively, I got my current house because of KYC laws.

The house bidding was originally won by someone abroad. They overbid the house by a lot. However, because of the KYC laws, that person needed to proof their income is legitimate, which they couldn’t. Therefore, we got the house.

Building new houses costs 10 years in my country. So building new houses is not fast enough to create new affordable houses.

Worked great for Vancouver /s

To be fair, you're referring to one of the largest and fastest-growing economies in Canada [1]. (It also has a massive affordability crisis despite a ban on non-student foreigners buying expensive real estate.)

[1] https://www.katrinaandtheteam.com/blog/vancouver-bc-economy/

Half the people in Vancouver are thinking about leaving and 25% want to leave within the next 5 years. People are leaving in droves largely because of costs. That seems to make the parents point - that the ecnomic benefits from immigration accrue to the few and the wealthy while making life harder for average people

https://vancouversun.com/news/survey-finds-half-of-metro-van...

I can sympathize with it because I live in Toronto and am also thinking about leaving. Do I hate immigrants, no there aren't actually that many immigrants in the city core where I live. But certaintly there is an affordability crsis that has gripped the city and the country and wages seemed to be supressed and there seems to be less job opportunities (likely due to all that extra labour coming in)

Vancouver's population has been steadily increasing. Maybe it's catering to different people than before, but it's not fewer.

In a hot real estate market, there will be more market pressure to fix the dilapidated properties in good areas.

Say they instead keep values artificially low so an EU resident can buy a property for cheap, and it stays cheap. What's the benefit?

The benefit is that more people can afford to buy houses? Really surprising to see a country taking care of their people, and not just the wealthy ones!

All the hypotheses claiming that "the market pressure will improve things for all" have been proven false at this point. We have decades of data, and this is only widening the inequality gap.

> The benefit is that more people can afford to buy houses?

Can they? I mean, what is your plan to lower current housing prices? Cut off demand from foreigners with purchasing power and instead replace it with demand from people who cannot afford a home? They are not even the same housing market, are they?

I don't see why this is better than people renting and investing their savings elsewhere, which is how it works with apartments anyway. So you own a house, it makes basically no return, now what?

Is the only reason you see for home ownership price appreciation? This mentality is what’s wrong with speculative real estate!

Yes. I don't know how you can buy something and hold it for decades without calling that "speculation."

You buy it so you can live in it, I am also not speculating when I buy a cabinet that I also hope to keep for decades.

Living in a house doesn't consume it along with the land, hence the investment appeal. You can rent a house if you just want to live in it. I would totally rent a cabinet if that were a thing, but it's not because the value goes to 0 quickly.

where exactly does a house make no return, especially in say last decade/15 years? I bought three houses in the last 20 years, one doubled, one up 70% and one 40% (still occupying it)

Do you not see how insane it is to at once 1) demand cheap housing and 2) demand it increases in price at breakneck pace?

I am not demanding cheap housing, I was only commenting on so you own a house, it makes basically no return, now what?

I'm saying that if they find a way to keep houses affordable to buy, they can't be viable investments. The US makes for a decent home investment market. You usually see a house price double every ~10 years once it's in a desirable area.

Btw, was your 40% increased house purchased 20 years ago? If so, that's effectively a loss, and I'm not even sure about the one that doubled. 5-10 years would be different.

Exactly, it's like complaining that gold is unfairly expensive. Those lucky Boomers got to purchase it at $40/oz in 1970 ($350/oz in 2025 money), now it's $2600/oz. I should be allowed to buy gold for $350/oz so I can profit like they did.

in 2050 when it is $13,764/oz kids will be complaining you got to buy it for $2,600

In the US, not many places. But that's the complaint from some people.

give me some places where it is not and we’ll look at zillow or whatever public data there is for a given region. unless we are talking like rural-no-is-around-for-miles perhaps but otherwise properties over the last 10-15 years have appreciated

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