‘Golden visas’ lure more Canadians – and no, they’re not disappearing

If money buys freedom, can it offer you the option of living anywhere in the world? Perhaps.

Alternative citizenship and residence rights – or “golden visas” as they’re known – are an invaluable asset in a wealthy investor’s portfolio, says Dominic Volek, Dubai-based managing partner of Henley & Partners, the global consultancy in residency-by-investment and residency-by-citizenship programs.

By making a significant investment in real estate, private equity or government bonds in a participating country, and by meeting certain qualifications, individuals are able to secure residence rights and/or citizenship. More than 100 countries offer some form of investment migration option to attract foreign capital and bolster government coffers.

But the regulations governing these programs are becoming stricter even as demand skyrockets, with some investors building a “portfolio of passports.”

I interviewed Volek recently for my podcast, Serious Coin: Rich Conversations About Wealth. Shortly thereafter, one of the most popular destination countries for Canadians announced it was tightening its rules.

Volek joined me from Henley & Partners’ office in Dubai to provide an update on golden visas and their allure for Canadian high-net-worth families who are looking for opportunities outside the country, especially since the government’s unveiling of the federal budget in April.

What are the key benefits of ‘golden visa’ programs?

I would say increased travel mobility and freedom of movement is No. 1. Secondly, because many of our clients are either self-made entrepreneurs or generations-old family business owners, additional citizenships and residency rights allow them to conduct their business more easily across a range of jurisdictions and also protect their capital from volatility at home.

I’ve also had investors who were focused on securing mobility not just for themselves and their children, but also future generations. One of them told me, “I am not sure what the world will look like in 50 years. I want to be sure that my children and grandchildren have options about where they want to reside and have the freedom and flexibility to have global education and cultural opportunities.”

In our podcast conversation, you mentioned that there’s been a shift in who is applying for these programs. Historically, the primary users were citizens of emerging countries in search of greater political stability and global mobility, but now you are hearing from citizens from developed countries. Why is that?

Today we have more American clients seeking alternative residence and citizenship rights than any other single nationality. It goes back to the pandemic. While the U.S. passport is one of the strongest in the world, during the height of the virus it didn’t guarantee travel freedom. We had clients with private planes who couldn’t land them and others with vacation homes they couldn’t retreat to. Many Americans came to the realization that being reliant on a single mobility option, the U.S. passport, was a risk they weren’t comfortable with.

We’re also hearing from people who are concerned about the upcoming election – on both sides of the political spectrum. And more recently, some clients have raised the issue of antisemitism. I’m thinking of one client who said that 27 of his family members had died in the Holocaust. He said, “They told themselves, it can never happen here … and then it did.”

In the case of your clients concerned about antisemitism in North America, which country or region are people choosing as their plan B?

Europe is the primary choice for most clients. But we do see some interest here into Dubai through their golden visas, and that’s because this is the most international city in the world. My kids have got over 100 or 120 different nationalities in their school. There is a very cosmopolitan, accepting, tolerant culture. We’re all different colours and cultures, and everyone just gets on quite well.

Where does Canada fit in? Are you seeing a similar rise in interest?

Yes. The appeal of these programs is growing among Canadians as well. Between 2019 and 2023, there’s been a 440-per-cent increase in enquiries from Canadians, and Canada is now among the top 10 countries based on the enquires we receive.

What are you hearing from Canadians?

Many are in search of a warmer climate for their winter retirement, and they’re looking beyond the traditional choices of Florida and the U.S.A.

Europe and the Caribbean are attractive alternatives for residency or citizenship. Unlike the Canadian passport’s limit of 90 days out of 180 days in Europe, if you have residence in a European country, this restriction is eliminated.

Access to free healthcare is also a crucial consideration in retirement, and countries such as Spain have a strong healthcare system. Another incentive is the opportunity to diversify financial and real estate assets to other countries and currencies.

I’m curious to hear if you’ve you seen any uptick in calls as a result of the capital-gains tax rule changes announced in the recent Canadian federal budget.

Whenever anything like this happens [capital gains tax changes], there’s always a spike in enquiries for us. And the Canadian wealth managers and tax advisors we work with also have reported a surge in enquiries from their clients.

But, you know, the reality is a lot of it is actually just misinformed. It’s like, “Oh my, capital gains taxes are going up, I should become resident somewhere else.” But I would say less than 5 per cent of our clients really physically exit and relocate to try and become more tax efficient. It’s a big, big commitment [to exit Canada]. It’s not about tax, more about having optionality.

Which destinations are the most popular for Canadians?

I would say the top European destinations are Spain, Portugal and Greece. In the Caribbean, we’re seeing demand for Antigua & Barbuda and Grenada.

And we see, from time to time, interest in places in Southeast Asia. Thailand, which is a huge tourist destination, also has interesting, longer term residence options. Malaysia has one. Low cost of living, great weather, safe. But Europe by far is the focus.

It’s interesting you mention Spain because it’s recently been reported that the government has plans to shut down its residence-by-investment program. Are you finding it challenging to meet the rising demand when the supply may be dwindling?

It’s funny. It’s a constant battle because it’s all about the sensationalist headlines. Spain hasn’t closed its program. It just announced modifications to the real estate investment option, similar to what the Greek and Portuguese programs have both already implemented. So likely Spain is just realigning its program, which it has not done since 2013. Portugal was the same last year. At the start of the year, some media just reported it’s closed, it’s closed, it’s closed.

When meeting with bankers and lawyers and family offices, the first thing I say is, “Portugal is open. It’s not closed.” So there is a lot of misreporting and misinformation, and then of course people try and use it as a sales tool as well: ‘You know, this is going to close, so you need to do this right now.’ And it’s just what it is. I guess we’re used to it now.

Responses have been lightly edited for clarity and length.

Kelly Willis Green is an independent marketing advisor to organizations seeking to better understand, reach and satisfy the unique needs of high-net-worth individuals. She is the creator and host of Serious Coin, a podcast that explores the financial, emotional and lifestyle benefits and challenges of coming into wealth.

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