With Spain's Golden Visa cancelled, is Spain still worth it as an investment destination for Canadians?

Spain's fundamental investment case exists independent of the Golden Visa. The Golden Visa was the residency-by-investment route — it is the path to EU residency that changes, not Spain's property market fundamentals. Spain's Costa del Sol (Marbella, Málaga) remains one of Europe's most active international property markets with a 40-year track record. The cancellation of the Golden Visa property route has two effects: (1) It reduces demand from Golden Visa-motivated buyers, which could moderate price growth in the €500K+ segment that the visa targeted. (2) Canadian investors who specifically wanted Spain as a Golden Visa + property + EU residency bundle need to find an alternative residency route. Portugal's Golden Visa (fund route, €500K+) and Greece's Golden Visa (€800K in zone 1 or €400K in zone 2) are the remaining EU Golden Visa options with Canadian traction. For Canadians who want Spain's property market purely as an investment (not as a residency pathway), the Golden Visa cancellation is largely irrelevant — the investment fundamentals are unchanged.

How does the VUT tourist licence situation in Spain affect my investment plan?

The VUT (Vivienda de Uso Turístico) licence for short-term rentals in Spain is the single most important due diligence item for any Spanish investment buyer in 2026. The situation varies dramatically by location: Barcelona has not issued new tourist apartment licences in most residential zones since 2014 — if you buy an apartment in Barcelona without an existing VUT licence, you cannot legally operate it as an Airbnb. Madrid has strict requirements. Valencia and the Balearics have quotas. The Costa del Sol is relatively more permissive, but even Marbella has VUT restrictions in some zones. The critical due diligence: before making any offer on a Spanish property you intend to rent short-term, verify (1) whether the property has an existing valid VUT licence, (2) whether the municipality is currently issuing new VUT licences, and (3) what the HOA and community of owners rules say about STR (many Spanish communities have banned STR in their bylaws). A property without a VUT licence in a restricted zone can still be rented long-term (under Spanish LAU long-term rental law), but cannot legally operate as an Airbnb-type STR. See the guide to Spain's non-resident income tax for the tax implications of both rental and vacant property strategies.

What is the fideicomiso annual fee burden relative to Spain's direct title costs?

Mexico's fideicomiso requires an annual trust fee paid to the bank trustee — typically USD $600–$1,200/year depending on the bank (Scotiabank Mexico, BBVA Mexico, Santander Mexico are the primary fiduciaries in resort markets) and the property value. Over a 10-year holding period on a $400,000 USD property, this is approximately USD $8,000–$12,000 in cumulative trust fees — a real cost. Spain has no equivalent ongoing annual cost for property ownership (the NIE is a one-time registration; IBI property tax is the annual holding tax equivalent, typically €400–€1,500/year for a 2-bed apartment depending on location and cadastral value). The comparison: Spain's higher closing costs (ITP: 6–10% vs Mexico's ISAI: 3–4.5%) are a higher upfront cost, but Spain has no ongoing trust fee. Over a 10-year hold, the fideicomiso adds approximately 1–2% of purchase price in cumulative fees, partially offsetting Mexico's lower closing cost advantage. The fideicomiso also adds estate planning complexity and requires trustee permission for certain structural changes to the property — these non-monetary costs are real considerations for long-term holders.

Can a Canadian get residency in Spain as an alternative to the cancelled Golden Visa?

Yes — Spain's Golden Visa property route cancellation does not eliminate all Spanish residency options for Canadians. The remaining routes: (1) Non-Lucrative Visa (NLV) — for people who can support themselves without working in Spain. Requires proof of sufficient funds (approximately €28,800/year minimum for 2025). No minimum property investment, no Spanish employment. This is the most accessible Spanish residency route for Canadian retirees with sufficient income. (2) Digital Nomad Visa — requires remote employment or freelance income outside Spain. (3) Entrepreneur/Investor Visa — investment in Spanish business activity, government bonds, or other non-real-estate assets above thresholds. (4) EU citizen route — if you have EU citizenship (including through heritage), you can register as a resident directly under freedom of movement rules. For Canadians specifically targeting EU residency through a property purchase, Greece (€400K–€800K depending on zone) or Portugal (fund route €500K) are now the primary Golden Visa alternatives. Spain's NLV is the more accessible long-term residency route for retired Canadians who want to live in Spain without the investment threshold.

How does Spain's non-resident imputed income tax work for a vacant property?

This is one of Spain's most counterintuitive property taxes for Canadian buyers: Spain charges an 'imputed income tax' (renta imputada) on non-resident property owners who do not rent their property. The logic: Spanish tax law assumes vacant property generates notional rental income. Even if your Spanish property sits empty for most of the year, AEAT (Spanish tax authority) imputes a taxable income of 1.1% of the cadastral value (valor catastral) annually for properties with updated cadastral values, or 2% for older assessments. As a non-resident, you pay the IRNR (Non-Resident Income Tax) on this imputed amount at 24% (19% for EU/EEA residents). Example: a vacation apartment with €200,000 cadastral value → 1.1% imputed income = €2,200 → non-resident at 24% → €528/year in tax even if the property is never rented. Compare to Mexico: Mexico has no equivalent vacant property tax — you pay predial (property tax, very low) and nothing else on a vacant property. This imputed income tax is the reason some Spanish non-resident investors ensure their properties are at least lightly rented to offset the taxed imputed amount with actual rental income deductions.

Which Spanish cities still offer good investment yields despite the VUT restrictions?

The VUT restriction landscape varies significantly across Spain, and some markets remain reasonably accessible for STR investors. The best remaining STR opportunity zones in Spain: (1) Costa del Sol / Málaga Province — Marbella, Torremolinos, Fuengirola, Benalmádena have active tourist markets and comparatively more permissive VUT licensing than major cities. New licences are restricted in some zones but not blanket-banned. (2) Alicante Province (Costa Blanca) — Benidorm, Calpe, Altea have active tourist rental markets. (3) Canary Islands — Tenerife and Gran Canaria have strong year-round tourism but also VUT quota systems in some municipalities. (4) Rural Andalusia / Extremadura — very affordable properties, light VUT restrictions, but thin rental demand. For comparison, the Costa del Sol (Marbella area) delivers approximately 5–7% gross STR yield on a well-licensed and well-managed property — below Mexico's prime market yields of 7–14%, but with the benefits of EU stability, euro denomination, and a deep international resale buyer pool.

Is Tulum or Puerto Vallarta a better Mexico alternative to Costa del Sol for a Canadian investor?

The Mexico vs Costa del Sol comparison for a Canadian investor is most directly relevant when comparing similar budget levels (€300K–€500K equivalent). At that price point: Puerto Vallarta beachside (Romantic Zone, Marina Zone) delivers 7–9% gross STR yield on a well-located condo, with a 10-year track record of strong Canadian and American buyer demand and an active resale market. Tulum delivers higher ceiling yields (8–14% for boutique eco-properties) with higher appreciation potential but also higher operator-dependency risk and greater infrastructure uncertainty. The Costa del Sol at similar prices delivers 4–7% gross STR (subject to VUT licence availability), with EU stability and a deeper long-term appreciation track record. The investment thesis: if you prioritize income yield now, Mexico wins. If you prioritize EU asset stability, Euro denomination, and the deepest international buyer pool for exit, Costa del Sol wins. The real question for most Canadian investors is whether they want income optimization (Mexico) or stability and EU access (Spain). Most of our Canadian buyers in this bracket choose Mexico for yield and choose Spain when they also want personal use and EU lifestyle access.

What are the Canada-Spain tax treaty implications for a Canadian owning a Spanish rental property?

Canada has a tax treaty with Spain (the Canada-Spain Income Tax Convention). For Canadian non-residents owning Spanish rental property: (1) Spanish rental income is taxed in Spain at the IRNR rate (24% for non-EU non-residents, or 19% for EU/EEA residents — Canadians pay 24%). Spain allows deductions for allowable expenses (management fees, insurance, mortgage interest) only if you are an EU resident — Canadian non-residents are taxed on gross rental income at 24%, without expense deductions in Spain. (2) The treaty provides relief from double taxation — Canada's CRA will provide a Foreign Tax Credit for the Spanish tax paid, up to the Canadian tax otherwise payable on the same income. (3) Capital gains on sale of Spanish property by a non-resident Canadian: Spain taxes at 19%; Canada taxes the gain as well with a credit for Spanish tax paid. (4) Spanish imputed income (vacant property tax) must also be filed annually in Spain — IRNR Model 210 is the non-resident tax return. Most Canadians with Spanish properties use a Spanish gestoría (administrative agent) to file their annual IRNR returns, typically costing €200–€400/year.

With Spain's Golden Visa cancelled, is Spain still worth it as an investment destination for Canadians?

Spain's fundamental investment case exists independent of the Golden Visa. The Golden Visa was the residency-by-investment route — it is the path to EU residency that changes, not Spain's property market fundamentals. Spain's Costa del Sol (Marbella, Málaga) remains one of Europe's most active international property markets with a 40-year track record. The cancellation of the Golden Visa property route has two effects: (1) It reduces demand from Golden Visa-motivated buyers, which could moderate price growth in the €500K+ segment that the visa targeted. (2) Canadian investors who specifically wanted Spain as a Golden Visa + property + EU residency bundle need to find an alternative residency route. Portugal's Golden Visa (fund route, €500K+) and Greece's Golden Visa (€800K in zone 1 or €400K in zone 2) are the remaining EU Golden Visa options with Canadian traction. For Canadians who want Spain's property market purely as an investment (not as a residency pathway), the Golden Visa cancellation is largely irrelevant — the investment fundamentals are unchanged.

How does the VUT tourist licence situation in Spain affect my investment plan?

The VUT (Vivienda de Uso Turístico) licence for short-term rentals in Spain is the single most important due diligence item for any Spanish investment buyer in 2026. The situation varies dramatically by location: Barcelona has not issued new tourist apartment licences in most residential zones since 2014 — if you buy an apartment in Barcelona without an existing VUT licence, you cannot legally operate it as an Airbnb. Madrid has strict requirements. Valencia and the Balearics have quotas. The Costa del Sol is relatively more permissive, but even Marbella has VUT restrictions in some zones. The critical due diligence: before making any offer on a Spanish property you intend to rent short-term, verify (1) whether the property has an existing valid VUT licence, (2) whether the municipality is currently issuing new VUT licences, and (3) what the HOA and community of owners rules say about STR (many Spanish communities have banned STR in their bylaws). A property without a VUT licence in a restricted zone can still be rented long-term (under Spanish LAU long-term rental law), but cannot legally operate as an Airbnb-type STR. See the guide to Spain's non-resident income tax for the tax implications of both rental and vacant property strategies.

What is the fideicomiso annual fee burden relative to Spain's direct title costs?

Mexico's fideicomiso requires an annual trust fee paid to the bank trustee — typically USD $600–$1,200/year depending on the bank (Scotiabank Mexico, BBVA Mexico, Santander Mexico are the primary fiduciaries in resort markets) and the property value. Over a 10-year holding period on a $400,000 USD property, this is approximately USD $8,000–$12,000 in cumulative trust fees — a real cost. Spain has no equivalent ongoing annual cost for property ownership (the NIE is a one-time registration; IBI property tax is the annual holding tax equivalent, typically €400–€1,500/year for a 2-bed apartment depending on location and cadastral value). The comparison: Spain's higher closing costs (ITP: 6–10% vs Mexico's ISAI: 3–4.5%) are a higher upfront cost, but Spain has no ongoing trust fee. Over a 10-year hold, the fideicomiso adds approximately 1–2% of purchase price in cumulative fees, partially offsetting Mexico's lower closing cost advantage. The fideicomiso also adds estate planning complexity and requires trustee permission for certain structural changes to the property — these non-monetary costs are real considerations for long-term holders.

Can a Canadian get residency in Spain as an alternative to the cancelled Golden Visa?

Yes — Spain's Golden Visa property route cancellation does not eliminate all Spanish residency options for Canadians. The remaining routes: (1) Non-Lucrative Visa (NLV) — for people who can support themselves without working in Spain. Requires proof of sufficient funds (approximately €28,800/year minimum for 2025). No minimum property investment, no Spanish employment. This is the most accessible Spanish residency route for Canadian retirees with sufficient income. (2) Digital Nomad Visa — requires remote employment or freelance income outside Spain. (3) Entrepreneur/Investor Visa — investment in Spanish business activity, government bonds, or other non-real-estate assets above thresholds. (4) EU citizen route — if you have EU citizenship (including through heritage), you can register as a resident directly under freedom of movement rules. For Canadians specifically targeting EU residency through a property purchase, Greece (€400K–€800K depending on zone) or Portugal (fund route €500K) are now the primary Golden Visa alternatives. Spain's NLV is the more accessible long-term residency route for retired Canadians who want to live in Spain without the investment threshold.

How does Spain's non-resident imputed income tax work for a vacant property?

This is one of Spain's most counterintuitive property taxes for Canadian buyers: Spain charges an 'imputed income tax' (renta imputada) on non-resident property owners who do not rent their property. The logic: Spanish tax law assumes vacant property generates notional rental income. Even if your Spanish property sits empty for most of the year, AEAT (Spanish tax authority) imputes a taxable income of 1.1% of the cadastral value (valor catastral) annually for properties with updated cadastral values, or 2% for older assessments. As a non-resident, you pay the IRNR (Non-Resident Income Tax) on this imputed amount at 24% (19% for EU/EEA residents). Example: a vacation apartment with €200,000 cadastral value → 1.1% imputed income = €2,200 → non-resident at 24% → €528/year in tax even if the property is never rented. Compare to Mexico: Mexico has no equivalent vacant property tax — you pay predial (property tax, very low) and nothing else on a vacant property. This imputed income tax is the reason some Spanish non-resident investors ensure their properties are at least lightly rented to offset the taxed imputed amount with actual rental income deductions.

Which Spanish cities still offer good investment yields despite the VUT restrictions?

The VUT restriction landscape varies significantly across Spain, and some markets remain reasonably accessible for STR investors. The best remaining STR opportunity zones in Spain: (1) Costa del Sol / Málaga Province — Marbella, Torremolinos, Fuengirola, Benalmádena have active tourist markets and comparatively more permissive VUT licensing than major cities. New licences are restricted in some zones but not blanket-banned. (2) Alicante Province (Costa Blanca) — Benidorm, Calpe, Altea have active tourist rental markets. (3) Canary Islands — Tenerife and Gran Canaria have strong year-round tourism but also VUT quota systems in some municipalities. (4) Rural Andalusia / Extremadura — very affordable properties, light VUT restrictions, but thin rental demand. For comparison, the Costa del Sol (Marbella area) delivers approximately 5–7% gross STR yield on a well-licensed and well-managed property — below Mexico's prime market yields of 7–14%, but with the benefits of EU stability, euro denomination, and a deep international resale buyer pool.

Is Tulum or Puerto Vallarta a better Mexico alternative to Costa del Sol for a Canadian investor?

The Mexico vs Costa del Sol comparison for a Canadian investor is most directly relevant when comparing similar budget levels (€300K–€500K equivalent). At that price point: Puerto Vallarta beachside (Romantic Zone, Marina Zone) delivers 7–9% gross STR yield on a well-located condo, with a 10-year track record of strong Canadian and American buyer demand and an active resale market. Tulum delivers higher ceiling yields (8–14% for boutique eco-properties) with higher appreciation potential but also higher operator-dependency risk and greater infrastructure uncertainty. The Costa del Sol at similar prices delivers 4–7% gross STR (subject to VUT licence availability), with EU stability and a deeper long-term appreciation track record. The investment thesis: if you prioritize income yield now, Mexico wins. If you prioritize EU asset stability, Euro denomination, and the deepest international buyer pool for exit, Costa del Sol wins. The real question for most Canadian investors is whether they want income optimization (Mexico) or stability and EU access (Spain). Most of our Canadian buyers in this bracket choose Mexico for yield and choose Spain when they also want personal use and EU lifestyle access.

What are the Canada-Spain tax treaty implications for a Canadian owning a Spanish rental property?

Canada has a tax treaty with Spain (the Canada-Spain Income Tax Convention). For Canadian non-residents owning Spanish rental property: (1) Spanish rental income is taxed in Spain at the IRNR rate (24% for non-EU non-residents, or 19% for EU/EEA residents — Canadians pay 24%). Spain allows deductions for allowable expenses (management fees, insurance, mortgage interest) only if you are an EU resident — Canadian non-residents are taxed on gross rental income at 24%, without expense deductions in Spain. (2) The treaty provides relief from double taxation — Canada's CRA will provide a Foreign Tax Credit for the Spanish tax paid, up to the Canadian tax otherwise payable on the same income. (3) Capital gains on sale of Spanish property by a non-resident Canadian: Spain taxes at 19%; Canada taxes the gain as well with a credit for Spanish tax paid. (4) Spanish imputed income (vacant property tax) must also be filed annually in Spain — IRNR Model 210 is the non-resident tax return. Most Canadians with Spanish properties use a Spanish gestoría (administrative agent) to file their annual IRNR returns, typically costing €200–€400/year.

Mexico vs Spain for Property Investment: Canadian Comparison Guide 2026

Reviewed on March 2026 by the Compass Abroad editorial team

For gross STR yield: Mexico wins clearly (7–14% vs Spain's 4–7%), and Mexico has no equivalent VUT tourist licence restrictions blocking new rentals. For EU stability, direct freehold title (no fideicomiso), and the deepest international buyer pool: Spain wins. Spain's Golden Visa property route has been cancelled — but Spain's Non-Lucrative Visa remains for retirees. Mexico's lower closing costs (5–8% vs Spain's 10–13%) favour Mexico at entry.

Spain's non-resident imputed income tax (1.1–2% of cadastral value annually, even if vacant) is a hidden ongoing cost with no Mexico equivalent. Both countries have Canada tax treaties. Verify VUT licence status before any Spanish STR investment purchase.

Key Takeaways

Mexico and Spain are two of the most popular international property destinations for Canadians — different hemispheres, different legal structures, different investment profiles. The headline comparison: Mexico delivers higher gross short-term rental yields (7–12% in prime markets like PV, Playa, Tulum) and lower entry prices for beachside product. Spain delivers EU market stability, a deeper secondary buyer pool, the stability of euro-denominated assets, and direct title without trust structure complexity.
The Spain Golden Visa has been a significant market driver since its introduction in 2013 — €500,000 minimum investment in property for residency eligibility. In April 2024, the Spanish government announced plans to cancel the property-based Golden Visa route for real estate purchases in Spain, citing housing affordability concerns. The announcement created market disruption: some buyers rushed to close before cancellation; others who had planned on Golden Visa residency as part of their Spain purchase thesis needed to reconsider. For Canadian investment buyers who were specifically targeting Spain for the Golden Visa property route, this changes the calculus. However, Spain's fundamental investment case — EU market, deep buyer pool, established legal framework — remains independent of the Golden Visa.
Fideicomiso vs direct title: this is one of the structural differences with real practical implications. Mexico's coastal restricted zone (50km from international borders, 100km from coastlines) requires foreign buyers to hold property through a fideicomiso bank trust — an annual cost of approximately USD $700–$1,000/year, plus administrative complexity for estate planning. Spain has no equivalent structure: foreign buyers hold direct freehold title with the same legal rights as Spanish citizens. Spain also has a NIE (Número de Identificación de Extranjero) requirement — similar to Mexico's RFC — but it is a straightforward administrative step rather than an ongoing trust relationship.
Gross STR yields: Mexico's prime resort markets consistently outperform Spain's comparable resort markets on gross yield. Puerto Vallarta beachside 2-bed: 7–10% gross. Tulum eco-boutique properties: 8–14% gross (highest in Mexico). Spain's Costa del Sol (Marbella, Puerto Banús): 4–7% gross. Barcelona (pre-STR restriction): was 6–8%, now more restricted. Madrid: 4–6% gross long-term focused. Spain's net yields are compressed by high closing costs (ITP transfer tax: 6–10% depending on the region), Spain's non-resident income tax on empty properties (1.1–2% imputed income tax on the cadastral value even if not rented), and high tourist licence restrictions in many municipalities.
The STR licence (VUT — Vivienda de Uso Turístico) situation in Spain has been significantly tightened since 2018, particularly in tourist-saturation cities. Barcelona has effectively banned new tourist apartment licences since 2014 and has not issued new ones in most zones. Madrid has strict VUT licence requirements. The Canary Islands and Balearics have imposed quotas. The Valencian Community (Costa Blanca, Valencia) has restrictions. The Costa del Sol (Malaga/Marbella area) has been more permissive, but even there new VUT licences face restrictions. For investment buyers targeting Spain for Airbnb income, this is the most critical due diligence item — analogous to Portugal's AL licence restrictions. Mexico has no equivalent STR licence restriction system in its coastal resort markets.
Capital gains tax (CGT) comparison: Mexico charges 25% CGT on the sale price (or 35% on the net gain — the seller chooses which applies). The notario withholds it at closing; the buyer is not responsible. Canadians also pay CRA CGT on the foreign gain. Mexico's capital gains exemption is available for primary residences held by Mexican tax residents, not typically applicable to Canadian investors. Spain charges a tiered CGT: 19% on gains up to €6,000; 21% on €6,000–€50,000; 23% on €50,000–€200,000; 27% on amounts above €200,000. Canadians also pay CRA CGT with a foreign tax credit for Spanish tax paid. Spain's non-resident CGT (19%) applies to non-residents, with 3% withheld by the buyer at closing. Both countries have Canada tax treaty implications: Canada-Mexico treaty (yes); Canada-Spain treaty (yes).
Entry price comparison: for beachside/resort property, Mexico is generally cheaper at equivalent quality levels. A beachside 2-bedroom condo in Playa del Carmen: USD $200,000–$400,000. An equivalent quality 2-bedroom on Spain's Costa del Sol: €250,000–€500,000 (USD $270,000–$540,000). For inland property: Mérida (Mexico) has extraordinary value — colonial homes from USD $100,000–$300,000. Spain's inland markets (Murcia, rural Andalusia) also offer value but rural Spanish property has thinner demand and can be difficult to resell.
Long-term appreciation: Spain's property market has recovered strongly since the 2008–2015 crisis, with coastal zones (Costa del Sol, Mallorca, Ibiza, Barcelona, Madrid) showing 30–50% appreciation from 2016–2024. The Spanish market is mature and deep — a 30-year track record as an international investment destination. Mexico's coastal markets (PV, Playa, Tulum) have seen steeper recent appreciation (50–100%+ from 2018–2024 in some markets) from a lower base, with emerging markets (Mérida, Mazatlán, Huatulco) potentially offering further upside. Mexico's higher appreciation trajectory carries higher market risk; Spain's market is slower but more predictable.

Mexico vs Spain Investment: Key Facts for Canadian Buyers

Spain Golden Visa (property route): Announced for cancellation April 2024 — €500K property route being ended. Fund and business routes may continue. Verify current status.(Spanish government 2024)
Mexico STR yields (prime markets): PV/Playa: 7–10% gross; Tulum eco: 8–14% gross. Mexico resort markets are top-tier globally for gross yield.(Mexico rental market 2026)
Spain STR yields (Costa del Sol): 4–7% gross — compressed by high closing costs, VUT licence restrictions, and non-resident imputed income tax(Spain rental market 2026)
Spain VUT tourist licence restrictions: Barcelona: effectively banned new licences. Madrid: strict. Costa del Sol: more permissive but tightening. Verify before any investment purchase.(Spain tourism law 2025)
Fideicomiso (Mexico coastal): USD $700–$1,000/year trust fee; administrative complexity. Not required in Spain (direct freehold title for foreigners).(Mexican property law)
Spain closing costs: ITP transfer tax: 6–10% (varies by region). Plus IVA (10%) on new builds instead of ITP. Notary + registration: 1–1.5%. Total: 10–13%.(Spain property law 2025)
Mexico closing costs (coastal): ISAI transfer tax: 3–4.5%. Notario fees, fideicomiso setup ~$1,500 USD, registration. Total: 5–8%.(Mexico closing costs 2025)
Spain NIE requirement: Required before purchase — similar to Mexico RFC. Can be obtained at a Spanish consulate in Canada (Montreal, Toronto, Vancouver) before arrival.(Spain immigration law)
Canada-Spain tax treaty: Yes — 15% withholding on dividends; 10% on interest; reduces double taxation on rental income and capital gains between countries.(Canada-Spain Income Tax Convention)
Canada-Mexico tax treaty: Yes — CPP/OAS withholding at 15% for Mexican residents. Rental income and capital gains subject to treaty-based double taxation relief.(Canada-Mexico Income Tax Convention)

Mexico vs Spain: 15-Factor Investment Comparison for Canadians

Mexico vs Spain property investment comparison for Canadian buyers — yield, costs, title, residency, and currency
Factor	Mexico (PV / Playa / Tulum)	Spain (Costa del Sol / Barcelona)	Winner (Investors)
Gross STR yield (resort beachside)	7–14% gross (prime markets)	4–7% gross (Costa del Sol)	Mexico
STR licence restrictions	Essentially none in resort markets	VUT licence restrictions severe in major cities and growing	Mexico
Entry price (beachside 2-bed)	USD $200K–$400K (Playa/PV)	€250K–€500K (Costa del Sol)	Mexico
Closing costs	5–8% (coastal, incl. fideicomiso)	10–13% (ITP 6–10% + notary + registration)	Mexico
Title structure (foreigners)	Fideicomiso (coastal) — USD $700–$1K/year trust fee	Direct freehold title — no trust structure	Spain
CGT (non-resident seller)	25% of price or 35% of gain (seller's choice)	19–27% tiered on gain; 3% withheld at closing	Mexico (slightly lower at 25%)
Golden Visa / residency	Temporary/permanent residency via investment possible	Golden Visa property route cancelled 2024; Non-Lucrative remains	Mexico (investment residency still available)
EU market access	No — Mexico only	Yes — EU/Schengen residency; EU banking, travel	Spain
Buyer pool depth (resale)	Active and growing; US/Canadian buyers dominant	Largest international buyer pool in southern Europe	Spain
Market stability / track record	Growing; 2018–2024 appreciation strong; higher volatility	Mature 30-year market; recovered from 2008 crisis	Spain
Non-resident empty property tax	None — property only taxed on rental income or sale	Imputed income tax: 1.1–2% of cadastral value even if vacant	Mexico
5-year appreciation (2019–2024)	50–100%+ USD in Tulum/Playa; 30–60% in PV	30–50% in Costa del Sol, Mallorca, Ibiza; 40–60% Madrid	Mexico (higher ceiling but higher risk)
Canada tax treaty	Yes — 15% CPP/OAS withholding; treaty double-tax relief	Yes — 15% withholding; double-tax relief on income and gains	Tie
Language (operations)	Spanish; English common in resort markets	Spanish; English widely spoken in expat zones	Tie
Currency (investment)	MXN-denominated (exchange rate risk vs CAD/USD)	EUR-denominated — euro stability vs CAD	Spain (euro is more stable vs CAD than MXN)

Spain's VUT Licence Crisis: What It Means for Investment

Spain's crackdown on tourist apartments has been more aggressive than any comparable country in Europe. Barcelona effectively banned new VUT licences in most residential zones over a decade ago. Madrid has a parallel path. The Balearics and Canary Islands have quota systems. For a Canadian buyer in 2026 who wants to buy a Spanish apartment and run it as an Airbnb: the only safe approach is to purchase a property that already has a valid, transferable VUT licence. Properties with existing licences command a premium — often 10–20% above comparable unlicensed properties — but that premium represents the entire difference between a legally rentable investment and a vacant apartment.

Compare this to Mexico's coastal resort markets: Playa del Carmen, Puerto Vallarta, and Tulum have no equivalent short-term rental licence restriction system for the Airbnb/VRBO market. Mexican properties in tourist zones can be rented short-term through any platform without a separate licence. This structural difference is the primary reason Mexico delivers higher net STR yields than Spain — it is not just price, it is regulatory freedom. See the guide to Airbnb investment property abroad for Canadians for the full STR investment strategy.

Spain's Hidden Ongoing Cost: Non-Resident Imputed Income Tax

Spain charges a tax on the notional income from vacant property even when you earn no rent. The IRNR imputed income tax (renta imputada) applies at 1.1–2% of the cadastral value, taxed at 24% for non-EU residents. On a €300,000 property with €150,000 cadastral value: approximately €330–€660/year in tax for doing nothing. There is no equivalent in Mexico — Mexican property that sits vacant pays only the annual predial (property tax), which is negligible. See the guide to Spain's non-resident income tax on empty property for the full calculation.

Mexico or Spain? Get Matched With an Investment-Focused Specialist.

Compass Abroad connects Canadian investors with vetted agents in Mexico's resort markets and Spain's Costa del Sol — agents who understand VUT licence status, fideicomiso structures, and the net yield picture after all costs.

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Mexico vs Spain for Property Investment