Portugal’s golden visa continues to be one of the world’s most popular residency by investment programs despite undergoing restrictive changes from January 2022.
Under the new rules, residential real estate investments in coastal locations including Lisbon, Porto and parts of the Algarve will no longer be allowed and there will be increases in minimum investment levels.
However commercial property investments in any part of the country will still qualify for Portugal residency including hotel share investments and touristic resort developments.
More than 10,000 investors, alongside 17,000 of their eligible family members, have obtained Portugal residency so far through its popular golden visa program which has brought in about 7.5 billion euros of foreign investment in its nine years of existence.
The program is highly popular with high net worth investors and their families due to its cost-effectiveness, attractive physical residence requirements, fast track to a second passport and overall simplicity.
Applicants can choose among various investment options to obtain the golden visa:
- Capital investment in bank accounts, supporting science and research or supporting arts and cultural heritage programs
- Real estate
- Investment funds
- Creation of 5 new jobs for Portuguese nationals or permanent residents
Buying property in Portugal has been the most popular option with over 90 percent of all applicants opting for real estate to qualify for Portugal residency.
Changes to Portuguese golden visa for Portugal residency
Under the new rules that came into effect on January 1 2022, real estate applicants can no longer purchase residential property just anywhere in Portugal to qualify for Portugal residency but have to invest in government-approved areas generally located in the interior regions of the country.
This change means that residential properties in investment hotspots such as Lisbon, Porto and Algarve no longer qualify for the golden visa. The government is hoping the change will help diversify investments coming into Portugal, focusing on key areas in need of support to local housing markets.
Minimum investment thresholds for most of the ventures that qualify applicants for the golden visa have been amended as below:
- The minimum investment required for capital investment in a bank deposit will be increased to EUR 1.5 million from EUR 1 million
- The minimum investment requirement for units in investment funds will be increased to EUR 500,000 from EUR 350,000
- The business/job creation option will maintain the need for creating and maintaining five permanent jobs for a period of three years, but the investment amount will increase to EUR 500,000 from EUR 350,000
- Minimum investment requirements in the Science and Research Activities category will rise to EUR 500,000 from EUR 350,000
How to qualify for Portugal residency by buying commercial property
Investors can qualify for Portugal residency by purchasing:
- Commercial property anywhere in Portugal worth at least EUR 500,000
- Commercial rehabilitation projects anywhere in Portugal from EUR 350,000
- Commercial rehabilitation projects located in a “low density” area from EUR 280,000
How to qualify for Portugal residency by buying residential property
Investors can qualify for Portugal residency by purchasing:
- Residential real estate in designated interior areas of Portugal worth at least EUR 500,000
- Residential rehabilitation projects in designated interior areas from EUR 350,000
- Residential rehabilitation projects located in designated “low density” areas within designated interior areas of Portugal from EUR 280,000
How will the changes affect the future of Portugal residency via Golden Visa?
While experts do not expect the changes to the golden visa program to adversely affect global demand, investors must be aware that the long-term trend is one of tightening of rules for popular programs such as Portugal.
Applicants must reside in Portugal for seven days a year for five years to be eligible to apply for a Portugal passport, after which they are free to sell their investment and recoup their funds. Applicants can spend those seven days a year wherever they want. They can also choose to invest in commercial properties in Lisbon, Porto or any other area where residential investments do not qualify.
Portugal has one of the most attractive housing markets in the world and savvy investors now have the opportunity to invest in up-and-coming areas outside Lisbon and Porto.
Demand for living in Portugal outside of the realm of the golden visa is also expected to continue to grow especially in Lisbon where 69 percent of all expats in Portugal live, and property appreciation may yet continue its exponential growth rate.
Commercial real estate also offers attractive options. Investors can purchase units managed by brand-name hotels and resorts, allowing them to obtain their golden visa through an investment that is attractive, profitable and has a clear exit strategy.
All in all, the changes to the Portuguese golden visa program open new doors of opportunity for investors while helping the Portuguese government balance the economic benefits between provinces.
If you would like to know more about the Portuguese golden visa, and how you and your family could become citizens of Portugal within five years, contact us today to book a free, comprehensive consultation and be sure to take a look at the program page elsewhere on our website!
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