Portugal has scraped its “golden visa” program for wealthy non-Europeans, that helped pull in foreign investment, mostly from Chinese nationals.
António Costa, Portugal’s prime minister, said his government would stop issuing new golden visas in order to “fight against price speculation in real estate”.
The programme in Portugal was introduced 10 years ago to aid recovery from the financial crisis and proved to be especially popular with rich Chinese citizens.
Online renewal of Portugal residence permits now available for golden visas
Portugal’s decision to end the scheme was driven by angst over a surge in house prices that has left many local residents struggling to find adequate accommodation, particularly in Lisbon and Porto, the biggest cities.
It came as part of a package of measures designed to combat the housing crisis, which is the most pressing issue facing Costa’s Socialist government.
Property prices have been driven up in recent years by foreigners purchasing second homes or apartments to rent out to tourists via platforms such as Airbnb.
The golden visas, known officially as residence permits for investment, were issued in exchange for property purchases of EUR 500,000 or more.
Holders gain the right to live in Portugal for five years, after which they can apply for permanent residence even though the minimum required stay in the country is only a few days a year. The scheme netted more than EUR 6bn in investment.
Portugal is not cancelling existing golden visas, but Costa said they could only be renewed if the property they were linked to was the permanent residence of the holder or a family member or if it was put on the rental market.
Since the programme’s inception in 2012, the largest number of visas has been granted to Chinese citizens, who have received more than 5,000, according to Portuguese government data. More than 1,000 went to Brazilians while Turkey, South Africa and the United Arab Emirates each received about 500.
Government officials said there had been a need for such a programme when it was introduced and it had broadly achieved its objectives, but the country now faced different problems over housing affordability.
In 2020 the Costa government announced a plan to curb the impact of golden visas on property prices by making it harder for holders to buy in Lisbon and Porto, but real estate executives say some people found ways to circumvent the restrictions.
