The Portuguese authorities proposed a plan to change the Golden Visa program. The changes mainly concerned the real estate investment option, as well as the minimum investment amounts. The state budget legislative proposal was approved on February 4th, 2020. With the pandemic, it was postponed until the beginning of 2021.
2021 Changes to the Portugal Golden Visa Program
The changes may affect the real estate investment for Golden Visa in larger cities. The measures will limit investors’ options to make a real estate investment in the growing urban cities.
What are they?
According to the proposal, real estate investment in Porto and Lisbon will be excluded from the Golden Visa program. The change also means that the investors will not be able to buy property on the coast of the Atlantic Ocean and the Mediterranean Sea, like the Algarve region. So, they need to look at the interior areas to buy property, where there is less demand. This change will only affect this type of investment. Other investment options such as the fund investment option will not be affected by this recent change.
So, the changes especially focus on the real estate purchase of the amount of €500,000 or €350,000 for urban rehabilitation.
If the government approves this, the new act will come into effect after the decree enters into force, most probably at the beginning of 2021.
Why are they coming?
In Portugal, the most popular investment option has been the real estate investment for the Golden Visa, since its beginning. Furthermore, most of the investors are especially interested in real estate properties in Lisbon and Porto. So, the country plans to change this to revive other areas and restore the old buildings as well.
In this way, the government intends to draw interest in low-density areas and restoration projects, as well as cultural heritage protection. So, the plan is to revive and develop various parts of the country.
Will these changes affect existing investors?
The changes will not affect the existing investors, who already started the application process. However, if new applicants apply for the program after the regulation comes into effect, then they must comply with the new rule.
When will these changes come into effect?
The secretary of state to the prime minister of Portugal stated that the changes will not come into effect until 2021. So, they try to prevent any injustice and confusion. This is why these new updates will not affect the applications that are in progress now. So, the country is planning to put this regulation into force in 2021.
What should a prospective investor do?
Currently, the real estate investment option in Lisbon and Porto is still available. Yet, you should also note that there’s not much time left. So, if you’re planning to buy property to get Portugal Golden Visa, now is the time to apply for it.
On the other hand, if the real estate investment option is not your priority, you can consider other options as well. For example, the investment in funds option is gaining popularity day by day. A minimum of €350,000 investment in a qualified fund is sufficient to get residency in Portugal.
Who will be affected by the new changes in the real estate investment option in Portugal?
The new changes will affect the investors who will apply for the Portugal Golden Visa after the end of 2020.
Can I still buy property in Lisbon or Porto?
Yes, you can still purchase real estate in Lisbon or Porto, at least until 2021, if not longer.
What are other investment options to get a Golden Visa in Portugal?
Other investment options include investing in venture capital funds, establishing business by creating ten job positions. You can also make some capital transfers to the country or to the R&D projects. Or, make a capital transfer to institutions for the protection of cultural heritage and art.
Where can I buy property other than Lisbon and Porto?
There are many great places you can consider investing in. Coimbra, Braga, and Nazaré are some of the best regions to invest in and live in Portugal.