How Madrid (Spain) became the 'Miami of Europe' and how it affects those who live there

Miami was long the benchmark for Latin Americans seeking a better life, especially those with more economic resources and eager for luxury.

But the sunny city of Florida, with its beaches and pleasant temperatures throughout the year, has recently had an unexpected and thriving competitor on the other side of the Atlantic: Madrid.

Since the end of the pandemic, the capital of Spain has become one of the most attractive in the world and also a magnet for well-off immigrants who are beginning to prefer it to the American Miami.

Ordinary Madrid residents have already noticed this for a long time in aspects such as difficulties in finding a table in restaurants or the rise in rental prices.

And the data corroborates it. When luxury real estate agency Barnes Global Property surveyed people with more than $30 million in wealth for its annual report, Madrid was the fourth most valued city in the world.

South Americans predominate in the growing interest of the global rich in Madrid. They are the ones who buy the 60% of luxury properties for sale in the Madrid market, ahead of the British, French and Americans.

Entire buildings in the Madrid neighborhood of Salamanca, one of the most expensive in Spain and traditionally dominated by the local wealthy classes, have been acquired by Mexican and Venezuelan buyers.

There are already Venezuelans who have renamed it the “Little Caracas”.

And, according to official data, Mexicans have invested more than 700 million euros (US$760 million) in the Spanish real estate market since 2020, the vast majority in Madrid.

More and more foreigners want to live in Madrid and are increasingly willing to pay more to do so.

“The attraction of Latin American talent and capital to Madrid is the same that occurred decades ago to Miami, but that has been balancedand the time will come when Miami will wonder why Madrid is looking at us in the rearview mirror,” José Luis Martínez-Almeida, mayor of the Spanish capital, says in conversation with BBC Mundo.

But the phenomenon also poses problems, such as the rise in rents, which is expelling many Madrid residents away from the city center and its lifelong neighborhoods.

What is happening in Madrid

For decades, the capital of Spain has been one of the preferred destinations for Latin American migrants looking for work in a country where they have the advantage of speaking their language.

Peruvian, Ecuadorian, Colombian and other nationality workers have been there for years, often employed in caring for the elderly and sick, construction and other sectors that do not always cover their labor needs with local labor.

But, although people in difficulties continue to arrive in Madrid, as reflected by the fact that Spain is the country in the European Union that welcomes the most Venezuelan refugeesa new profile of Latin American immigrant with more resources has emerged in recent years.

“Almost all the clients we help emigrate to Spain are solvent people who have no need to generate income there,” Alexandre Rangel, general director of Siespaña, a firm specialized in advising foreigners looking to settle in Spain, tells BBC Mundo. the European country.

In fact, a few years ago large Latin American capital landed in Spain, such as those of the Mexican magnate Carlos Slim, who acquired part of the FCC company, a Spanish infrastru
cture giant, or the Venezuelan banker Juan Carlos Escotet, who today controls Abanca. , one of the main banks in the country.

But, as Nuria Vilanova, from Ceapi, an association of directors of Ibero-American companies, points out, “now they have descended to more familiar investments, in which so much capital is not required, and many are investing in things such as the purchase of real estate for the tourist rental”.

What has made the bars and squares of an old capital nestled in the dry Castilian plateau have become as attractive or more attractive than the paradisiacal beaches, the wide avenues with palm trees, and the yachts and luxury cars of Miami?

Be “at home”

“The majority of those who arrive for the first time [a Madrid] They value the quality of life, the public services, the restaurants that open every day, the possibility of getting around by public transport and, above all, the tranquility of living in a safe country, since in theirs they lived permanently threatened by crime “explains Rangel.

Spain and its capital also offer the possibility of protecting assets threatened by unexpected government decisions or the monetary turbulence to which Latin America is accustomed in a solid currency like the euro.

Although there are other factors, perhaps more intangible, as explained by Eladio Duque, one of the many whom Rangel helped to emigrate.

“I lived in Miami for 12 years and I never felt at home; When I arrived in Madrid I felt at home from the first day“says this Venezuelan-American.

Eladio arrived in Miami at the time when Hugo Chávez ruled in Venezuela.

He set up a company dedicated to renovating spaces and worked hard to achieve success and American nationality, but in 2022 he fell in love with Madrid.

He now runs his Miami business from his apartment in Madrid's Tribunal area.

Madrid is for him “the most wonderful city on earth” and he has decided to stay. “Here people don't look for me for what I have, but for what I am,” he says.

In a few months you will be able to apply for citizenship, a much faster and easier process in Spain than in the United States.

Spanish law allows Ibero-American citizens to apply for nationality after only two years of legal residence in the country, which is also easier to obtain than in the United States.

And to the different types of visa that those with sufficient financial resources can apply for, there are facilities such as 85% reduction in tuition fees in Madrid public universities for Ibero-American students announced at the end of the year by the Madrid regional government, which seeks to ensure that Madrid continues to “consolidate itself as a reference for studies in Spanish.”

According to Vilanova, “Spain is displacing the United States as the place where the children of Latin American business leaders are educated,” and the differences in the immigration policy of both countries appear as one of the reasons.

Some differences that Rangel encounters on a daily basis: “Most of my clients first think of Miami because they have family there or have visited it at some point, but then they realize that in reality the United States has closed its doors to migration.” legal and those who want to do business, because it forces
them to invest large amounts, hire employees, embark on projects over which they have no control and wait for years for the process to be resolved.

The Mexican Carla Chanes is another of the Latin American people who has recently arrived in Madrid.

He embarked on the adventure, tired of living in fear of crime in Mexico City.

And although there is always the possibility of minor crimes, such as theft by pickpockets who mainly operate in the city center and at busy tourist attractions, Madrid is generally safe and its crime rate is low.

Carla now lives with her family in Alcalá de Henares, the historic town about 30 kilometers from Madrid where the writer Miguel de Cervantes was born.

His son studies at a private school subsidized by the Community of Madrid (the regional government) for which he pays about 40 euros a month (US$43.4), well below what a private center usually costs in his country.

While waiting to obtain nationality, his family supports himself with his savings and what he receives from the rent of his house in Mexico.

“Here we realized that you could live spending less“, it states.

He says that “the beginnings were hard, but over time I realized that I no longer walked in such a hurry and I no longer had to always hold my son's hand for fear that someone would take him from me. The tranquility of living in A safe country is priceless and now I enjoy my toast with tomato and my coffee with milk for breakfast every morning.

But if Carla arrived in a Madrid that received her “with open arms”, Some of those who were there before are starting to see how their city is becoming too exclusive. for them.

Increasingly high rents

Andrés Pradillo, spokesperson for the Madrid Tenants' Union, told BBC Mundo that “Rents in the city have risen 60% since 2015 and many families already have to allocate more than half of their income to housing.

According to Pradillo, “the phenomenon of foreigners buying houses in Madrid is growing disproportionately.”

More than half of the houses sold in Spain last year were sold without the granting of a mortgage; that is, they were paid in cash.

This, according to Pradillo, reflects that “they are houses that were bought not to live in, but to speculate and obtain great returns in areas with very high rents.”

As a result, says Pradillo, “many people in Madrid are disappointed that they are being expelled from their lifelong neighborhoods,” which is why they demand that the authorities regulate rental prices, an issue that has gained increasing weight in Spanish politics in recent years.

Mayor Almeida admits that “as happens in other large cities, Madrid's big problem is housing“.

But he is clear that “the arrival of people and capital with the capacity to invest is a good opportunity for the city, as long as we know how to face risks such as possible increases in inequality gaps.”

How to do it is the key.

The mayor assures that he will give up public land so that private developers can build affordable rental housing on it.

“In the next few years alone we will increase the number of houses available for rent in Madrid by 4,000.”

New urban developments, such as Madrid Nuevo Norte and Operación Campamento, in which 10,700 homes will be built, the 60% public protectionshould alleviate the supply deficit suffered by the capital.

Will they be enough to offset the increase in demand in an increasingly fashionable city?

Only time will tell.

As its mayor says, “Madrid was the best kept secret, but that secret no longer exists.”

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