Portugal is allowing ‘Golden Visas’ in major cities for another year, instead of limiting the investment-for-residence scheme this year.
The Goverment had previously announced the end of ‘Golden Visas’ for foreign real estate investors on the coast and metropolitan areas of Lisbon and Porto for mid-2021, as well as other coastal areas, but has now extended the deadline to January 1, 2022, through a new decree.
Portugal’s Association of Real Estate Developers and Investors (APPII) had said the move will hurt foreign investment during a difficult period: “this is not the right time to introduce this change, which is making it difficult to recover from the social and economic crisis that our country is experiencing because of the Covid-19 Pandemic”, APPII said.
The decree allows residence permits in Portugal to those who invest in residential properties located in the Autonomous Regions of the Azores and Madeira or in the interior regions.
The revision, according to the new decree, intends that the “regime can be directed preferentially to the interior territories, to investment in job creation and to the urban and heritage requalification. cultural”.
The diploma also increases the investment thresholds, when opting for fund transfer (increases from 500 thousand euros to 1.5 million euros) or for investing in scientific research activities (rises from 350 thousand euros to 500 thousand euros).
To create a company or obtain a ‘Golden Visa’ through the purchase of investment units in investment funds or venture capital funds dedicated to the capitalization of companies, the minimum value also rises from 350 thousand to 500 thousand euros.
In more than seven years – the ARI program was launched in October 2012 – the accumulated investment until last July totaled 5.4 billion euros, with the acquisition of real estate totaling 4.9 billion euros. By nationality, China leads the way in granting visas (4,652), followed by Brazil (956), Turkey (433), South Africa (370) and Russia (340).
According to official data, in January, the investment resulting from the Residency Authorization Program for Investiment (ARI) totaled 33,12 millino euros, 26.6% less than a year before, but 19% than the previous month.
By countries, 27 residence permits were granted to nationals of China, five of Brazil, four of Russia, three to the United States and three to the Philippines.
Portugal has been badly hit by the pandemic-fueled economic crisis, with the economy falling 7.6% last year.
Instead of a quick rebound this year, a second and even more damaging wave of covid-19 forced the country to a lockdown since early february, wich could extend to mid-march or even april.
An end-january forecast by Catolica Lisbon Forecasting Lab estimates another drop in 2021, of 2%, which would bring the total drop in the two year period to almost 10%.
In extending the deadline for the new ‘Golden Visa’ rules, which would translate into less investment in real estate, the Government took into consideration the appeals from the real estate sector, but also the country’s dire economic reality.
If the economic rebound takes longer than currently expected by the Government – which will depend on the vaccination campaign in the European Union, which has been slow, and the Tourism sector recovery – a further extension of the deadline is possible.