New Residency Investment Programs Favor Value-Driven Developing Markets

Latin America is apt to take advantage of buyers looking for stability and quality of life;European markets still thrive amid slowdown in investment programs

While using strategic investment in While using strategic investment in global luxury real estate is nothing new, broader geopolitical uncertainty is changing what were largely predictable ebbs and flows of how money moved between national borders. So-called residency-by-investment programs help buyers with means find safety and assurance in developing or second-tier markets. “Affordability is a factor here,” says The Agency Nicaragua’s Managing Partner, Joao Mucciolo.

He explains that after the pandemic, building costs rose dramatically, yet wealthier families continued to look at Nicaragua as a place where the U.S. dollar (as the world’s reserve and most widely used currency) could go further. Major improvements in the quality of the nation’s school system, in addition to the continued progress of the “La Costanera” road—which will cut commute times significantly across a key country route—are encouraging more buyers to take a look at Nicaragua.

To the south, Costa Rica appears to be putting a further stake in its historically strong foreign market with a $50,000 reduction in its residency investment framework enacted in 2021. Now, buyers can potentially earn residency with a $150,000 investment. “Prior to that adjustment, residency-linked buyers were almost exclusively in higher price points,” says Clari Vega, Managing Partner, The Agency Costa Rica. “However, the move has had a secondary effect. This expands the overall buyer funnel and introduces more investors to the market earlier, some of whom eventually move up into the $1 million-plus segment once they gain confidence in Costa Rica as a place to allocate capital.”

The Old Logic

Investment optimization says you should find a program with the best ROI threshold and arbitrage the entry point.

2026 Buyers' logic

Strategic optionality is a reliable second residence on standby in a stable jurisdiction that could one day become primary.

That forward-thinking policy only serves to strengthen the higher end of Costa Rica’s market, especially in areas like the resort province of Guanacaste. According to Vega, since the opening of Marina Flamingo, a full-scale vacation village with rentals, a marina, and residences, there has been a measurable increase in demand for luxury homes and branded residences in the surrounding areas, with consistent absorption in the $1 million to $5 million range. What’s more, “you can’t underestimate the impact of schooling which comes both before and after the critical mass of primary and co-primary investor residents,” she adds, as an interesting comparison with their neighbors in Nicaragua. “Buyers are asking more about rental yield, exit liquidity, and long-term holding costs than they were five years ago,” she notes.

In Mexico, buyers are echoing some of those same considerations when looking at locations such as San Miguel de Allende, a four-hour drive north from Mexico City. “Many international buyers, particularly from the U.S. and Canada, continue to view San Miguel de Allende through a long-term lifestyle and investment lens rather than focusing heavily on short-term currency movements, says Ruben Valerio, Managing Director of The Agency San Miguel de Allende. “It’s being increasingly viewed as a long-term safe haven investment.”

40% growth has been seen in residency applications in Panama across all investor categories

Vicky Levitam via QIPR

One of the newer residency-by-investment programs is in neighboring Panama, where the country’s Qualified Investor Permanent Residency program (QIPR)—launched in 2020—is experiencing its “strongest period” on record, according to The Agency Panama’s Vicky Levitam. “Residency applications across all investor categories grew 40% in the first half of 2025 versus the same period in 2024,” she says.

Younger and more affluent buyers are flocking to Panama because of the relative ease with which they can obtain residency and the country’s match to the value of the U.S. dollar since 1904. “This makes Panama the only country in Latin America where the dollar is essentially irrelevant for the domestic buyer and uniquely powerful for the foreign one,” Levitam says.

This attracts Canadians, Europeans, and others looking for much more value comparatively to their home or other developed markets. As an interesting contrast, she’s also seeing more American buyers trickle toward Panama as a safe haven for U.S.-denominated assets. They’re able to keep their residences available in a safe currency, but without the uncertainty currently flooding the natural borders of the U.S. “That shift—from investment optimization to strategic optionality—is the defining characteristic of Panama’s international buyer in 2026,” she says.

⸺ At a glance

Residency investors seeking strategic optionality are shifting their focus

The Agency, OECD, EF English Proficiency Index (2026), Realtor.com

A Volatile U.S. Dollar is Still the Global Benchmark Currency

Even though the U.S. dollar is around 14% off its highs from mid-2022, it’s still around 4% higher when looking at its value from a decade ago, a hallmark of the greenback’s enduring strength (or the “King Dollar” era as it has been called). Bulk currency and assets purchased with it are still considered a generally “safe” option, luxury real estate included.

“It would be difficult to establish a direct correlation between the value of the U.S. dollar and luxury home purchases, as many other variables influence buyer behavior, including stock market performance, capital gains cycles, tax policy changes, and local inventory constraints,” says Realtor.com Senior Economist Anthony Smith.

Some of the more popular second-home destinations in the Western Hemisphere, such as those in Mexico, Panama, and Costa Rica, are transacted in U.S. dollars anyway, so the volatility of the currency doesn’t have as nearly as dense of an impact. “The fluctuation between the U.S. dollar and the Mexican peso has not significantly impacted our market in the way many might expect,” says Valerio, of The Agency San Miguel de Allende. “At the same time, Mexican buyers continue to remain active in the luxury and lifestyle segments, especially those looking to preserve capital in hard assets with strong long-term appreciation potential.”

Overall, international demand for American luxury real estate is still strong and Smith notes that when the dollar is weaker, there’s usually more foreign interest stateside because those buyers can see their purchasing power go further. “Gateway markets like Los Angeles, Miami, and New York frequently see higher volumes of international investment and a more established global buyer base than many other areas within the country,” he says.

Tightening European programs show little sign of slowing down investment

While common sense would suggest that the winding down and tightening of residency investment programs across Europe would curb buyer interest, most signs are actually pointing to the opposite. “The influx of international buyers has actually increased since the termination of Spain’s investment program last year,” says The Agency Mallorca’s Managing Partner Alby Euesden. “Successful transactions among U.S. buyers actually doubled from 2024 to 2025.”

The Agency Barcelona’s Managing Partner, Josep Turró Bassols, adds that the program’s overall effectiveness might be overstated as it only accounted for 0.3% of total transactions over the period it was offered. In the fourth quarter of 2025 alone, he notes that as many as 14% of buyers in Spain were foreigners, with that number rising to 25% within Barcelona. “The market was never structurally dependent on the investment program,” he says.

Next door in Portugal, The Agency Portugal’s Managing Partner, Ayres Neto, has noticed similar adjustments. “With the removal of real estate from the Golden Visa framework in 2023, what we saw was not a drop in demand, but rather a shift in its nature,” he says.

Buyers are continuing to look at Portugal for quality of life, safety, and long-term stability, considering the country as a safer bet within the eurozone. According to recent data from the Organization for Economic Cooperation and Development (OECD), Portugal is experiencing one of the strongest economies in Europe, outpacing the growth of the euro and a projected 1.9%-2.2% growth in gross domestic product by the end of 2026. It also helps that, as a whole, the company is very proficient in English. In fact, Portugal ranks sixth in the world in the 2026 EF English Proficiency Index.

Portugal’s ranking in the 2026 EF English Proficiency Index

EF EPI (2026)

GDP growth forecast for Portugal by end of 2026

OECD (2026)

of Spain's home buyers were foreigners during Q4 2025

Josep Turró Bassols (2026)

Italy’s debt ratio is considerably worse, with multiple projections suggesting that it will take over Greece as the eurozone’s most indebted country by the end of the calendar year. How this affects its real estate business remains to be seen, but the nation’s residency-by-investment program will be a decade old in 2027 with much broader parameters compared with other European countries. The program has fee thresholds for start-up and existing business investment, along with specific tax reprieves if the buyer makes Italy their main residence. “The program is designed for serious international investors,” says Salvatore Baldinu, Managing Partner of The Agency Sardinia. He notes that when the U.S. dollar remains strong, American buyers move more confidently and are “more willing to compete” for turnkey villas, seaview homes, and trophy residences. Even when the dollar is weaker, American interest remains, but buyers become more selective.

The strength of residency-by-investment programs appears to be a healthy spur for business in developing markets with proven high-end areas or regions where buyers can find value and quality of life. Even if global uncertainty calms down in the next 12 to 18 months, a “new normal” where geopolitics can change on a dime will inspire buyers of means to look at markets where they can set up shop and have a reliable second residence on standby that could one day even become primary. ●