2025 Housing and Immigration Law in Andorra
- elizabethhelenpier
- May 6
- 5 min read
Updated: May 15
Are you looking at investing in real estate in Andorra, buying property or moving to Andorra soon? If so, read on for more information on the brand new law introduction affecting all these topics in Andorra.
In the wake of the Andorran housing crisis which caused an exponential (300-400% by 2025) increase in rent prices as well as huge rises in property prices, the Andorran government have been under a lot of pressure to rectify the issue. From here the Omnibus (sustainable growth and right to housing) law was created. The aim of this legislature rewrite is to simultaneously curtail immigration and try to guarantee the right to a home for all Andorran citizens and residents. In the following article we give an overview of all the important points of the new 2025 immigration and housing reform in Andorra, for anyone interested in moving to or investing in Andorra.
For ease of reference, the term foreign investor here means any person who does not reside in Andorra, or who has legally resided in Andorra for less than 3 years.
Investing in Andorran Real Estate
The most important reform in the new Andorran housing and immigration law of 2025 has been the change to the criteria of approval for foreign investment in Andorran real estate. This section of the legislation diminishes the options for foreign investment in properties. As foreign investors account for a large portion of property owners and developers in Andorra, blocking foreign investment could in theory stabilise or drop the prices of property in Andorra.
Foreign investors in Andorra are now only permitted to invest in:
Or 1 plot of land that will be used to build 1 house or 1 apartment block
Or 1 built house
Or 2 apartments
Or 6 parking spaces
The exception to this rule is if the property or properties purchased are rented for a
minimum of 10 years at government-controlled rent prices.
Furthermore:
Real estate development is now forbidden by foreign investors unless at least 50% of the properties are put up for rent at government-controlled rent prices
Investment in, or purchasing of tourist rentals (Airbnb type properties) in Andorra is now forbidden by foreign investors
Investment in property to be sold in a rent-to-buy scheme is now forbidden by foreign investors
Investing in Andorran Companies
Concerning foreign investment in companies in Andorra, there has a been a very slight tightening of the requirements. It is an indirect control over J.1 residencies (residency with company formation). Constricting the regulations that control foreign investment represents harder initial approval and renewal for a J.1 resident, with the idea to abate the J.1 residency applications or renewals.
All foreign investment in Andorran companies needs previous authorisation from the government. The exception to this rule is if the foreign investor owns less than 10% of the shares, or if the purchase or donation is part of a divorce settlement or due to death
New companies opened through foreign investment, must show income within the first 18 months of activity
Immigration
When it comes to the immigration reforms in 2025, the objective has been to dissuade people from applying for job sponsorship in Andorra (A.1 Residency and Work) and then switching to self-employment once residency is obtained, to avoid paying the €50,000 government bond required with the J.1 Residency with Company Formation application. Furthermore, the changes on passive residency requirements are in effect to stop passive residents investing in cheaper property and therefore pushing up prices of this real estate price bracket.
Anyone entering Andorra under an A.1 Residency and Work visa, is no longer permitted to work for themselves i.e. under the regime of owning a company, in the first year of their residency
For passive residents, if the €600,000 investment is made in real estate, the value invested in each property must be equal to or surpass €600,001. This means buying various properties of 400,000€ or above as per anterior legislation, will no longer be permitted
€500 is now to be paid on renewal of any passive residency application. The initial €3000 and €1000 for family members, still stand on first application
Tourist Rentals (Airbnb)
The Andorran government are keen to bring as much property back on the market for rent as possible to cap or lower the rental prices. Being a country with a large portion of its GDP coming from tourism, many of the rental properties in Andorra are rented under tourist licenses rather than for long term rent. In the Omnibus legislature, the government have decided to halt any new tourist rental licenses for the indefinite future which should in effect bring many more properties up for sale or long-term rent by 2028.
No new tourist licenses for any properties in Andorra will be granted for the indefinite future
All current tourist rental licenses will need to be renewed before 30 April 2028
The license will not be renewed if the apartments in the building containing the tourist rental apartment are at least 60% residential (less than 30% of the apartments in the building have a tourist rental license)
Any 5* rentals with licenses granted between 2022 and 2023 have until 30 April 2030 to renew
Empty Properties
The most controversial of the changes in the Andorran Omnibus law is the government's seizure of all empty properties in Andorra. The government have estimated that there are over 1000 privately owned empty apartments in Andorra. The policies that follow are to force as many of these empty apartments as possible back for long term rent or sale in order to stabilise or reduce rental and sales prices of property in Andorra.
The Andorran Government will apprehend Andorra’s privately owned empty apartments to put them up for rent
This apprehension will last for a maximum of 5 years, the rental price will be according to the governments rent controlled thresholds, and paid in full to the owner
The empty properties to be apprehended do not include:
second residencies
property that has been for sale for under 18 months at a price not over the official government statistic price averages
property advertised for rent for less than 18 months for a price not superior to official government statistic price averages
The Andorran Government will pay to reform any property that is currently not fit to rent, for a value of up to 2 years rental income. This amount will then be deducted from the rent received.
