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In the last eight years, Portugal reached a high level of notoriety in the real estate sales to foreigners. The reputation of Portugal as a tourist destination of choice has shown that the real estate sales products to foreign investors is highly beneficial. In 2021, Portugal was elected the best tourist destination in the world, ahead of countries such as New Zealand, Japan, Italy, among others. Several leading international publications, including the prestigious Condé Nast Traveller, have named our country as the best place in the world to visit.
After a planetary pandemic, Portugal (re)rises itself as one of the countries that brings together a set of unique factors to attract foreigners to reside here.
Its great climate with its approximately 3000 hours of sunshine a year, its much-appreciated gastronomy, its enviable security and absence of any conflicts of any nature or religious tensions, make Portugal a privileged destination worldwide, unique to live and visit.
The very attractive tax regime in force for foreigners, transforms Portugal into a unique tax haven, thus helping to settle residents and foreign investors who find real estate prices here that are very low, when compared to the prices practiced in most Western European countries.
It has been shown that around 33% of new foreign residents always buy residence in that country. This fact has helped in the consolidation of new real estate projects in Portugal and in the sustained rise in prices.
New rules for golden visas
With the launch of the Golden Visa program in 2012 and the huge growth of tourism in Portugal, the numbers of purchases of Real Estate properties by foreigners reached a total of six billion euros, between 2012 and 2019. Unfortunately, in the years 2020 and 2021 it saw a sharp drop in the Portuguese tourist market as a result of the pandemic crisis. However, even with this pandemic, the country maintained the high interest of foreign investors in the Real Estate sector.
As of January 1, 2022, the Golden Visa program was changed, with the eligibility to obtain a Golden Visa only for purchasing real estate outside the coastal strip, including Lisbon, Porto and Algarve.
However, the possibility of obtaining the Golden Visa remains for those who invest a minimum of €500,000 in the purchase of participation units in venture capital funds.
Advantages of investing in venture capital funds
These funds, with a portfolio of at least 3 companies that own real estate projects, have an average investment period of 7 years, presenting strong advantages over the purchase of a simple real estate unit. Namely: investment in a fund with diversification of real estate assets, absence of annual maintenance costs, obtaining annual returns that can reach more than 6% per year, supervision by a state financial regulator. The Portuguese regulator, the CMVM, offers investors the guarantee that all Funds are managed with the utmost prudence, professionalism and rigor. For example, before any asset is purchased for the Fund, detailed assessments will have to be carried out and the regulator requires that the fund’s results are presented to investors every six months.
Fund management is carried out by specialized management entities approved by the regulator, who charge an annual management fee whose main objective is to defend the interests of investors.
Thus, this change in the new regime for obtaining the Golden Visa could seem to be a negative point, in fact this change represents greater protection for the investor, not only in terms of costs, but primarily with regard to the potential appreciation and protection of your heritage.
