Golden visa programme in Portugal set to become faster and simpler

by Ray Clancy on September 7, 2018

The golden visa programme in Portugal, which has attracted a large number of Non-Europeans to move to the country, looks set to become even more attractive with a shorter and more simplified application process.

There are several ways to access the golden visa programme, but it is the real estate scheme that has proved most attractive and according to the Association of Estate Agents in Portugal (APEMIP), foreigners bought one in four homes sold in the country last year.

Algarve Portugal

(By Steve Photography/Shutterstock.com)

And a new report from international real estate firm Knight Frank reveals that the golden visa scheme has attracted over 6,300 real estate investors since it began in 2012 and is particularly popular with buyers from China, Russia and South Africa.

The programme has been around since October 2012 and is regarded as an efficient way for foreign investors from non-EU countries to obtain permanent residence in Portugal, thereby also allowing freedom of travel in most European countries in the Schengen area.

Under the current requirements applicants need to invest a minimum of €500,000 in property, or €500,000 in small and medium sized companies, €350,000 in scientific investigation or €250,000 in artistic production, preservation or conservation of cultural heritage.

Once they have been in the country for six years they can apply to become Portuguese citizens.

The scheme in Portugal, has proved to the most successful in Europe with some €3.9 billion invested since September 2012, of which over 90% has been made through investment in real estate.

The changes under consideration aim to increase the number of foreign investors in the country and they come at a time when the property markets in the Algarve and Lisbon are seeing strong growth with sales and prices up.

A decade ago, 60% of buyers on the Algarve originated from the UK and Ireland, but this has changed significantly with Northern Europeans now active and the UK share declining, according to Knight Frank.

Overall, prime prices on the Algarve increased by 6.5% in 2017 year on year and mainstream prices in Lisbon are now 24% above the bottom of the property market in 2012.

‘Unlike a number of countries, the Portuguese Government has not tightened rules on foreign ownership or increased property taxes. Instead, the absence of inheritance tax along with two key initiatives have been critical in attracting new investment,’ said Alex Koch de Gooreynd, head of Knight Frank’s Portugal desk.

He also pointed out that the Non-Habitual Residence (NHR) tax rule, introduced in 2009, allows for a flat rate of 20% personal income tax from activities performed in Portugal and a tax exemption, including pensions.

Since 2000, Portugal’s foreign-born resident population has doubled from 207,000 to 416,000 according to figures from the Portuguese Government.

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