Portugal’s residency by investment programme has long been seen as a gold standard, but time is running out to apply on the most favourable terms. From 1 January 2022, the Portuguese government will introduce restrictions making the visa less attractive to investors and others hoping to secure a prized EU passport. Technically, the deadline for applicants wanting to take advantage of the current more favourable terms is 31 December this year, but in reality, there is much to arrange and plenty that may hold up an application submission. I strongly recommend starting the application within the next few weeks to ensure plenty of time to prepare and a complete submission.
These are the proposed changes that will make the Golden Visa less attractive.
Prime location real estate investments will be unavailable
Direct real estate is easily the most popular type of qualifying investment for Portuguese residency. In the first quarter of this year, 90% of visas issued were through a property purchase. However, in 2022 the new rules will restrict the location of qualifying to away from prime location.
The major cities of Lisbon and Porto will be excluded from Golden Visa applications and prime areas of coastline. Applicants wishing to qualify will have to purchase properties in the interior or in the autonomous regions of Madeira and the Azores. In other words, properties with the best prospect of seeing a growth in value. If you are looking to get value as well as a passport from your application, you should start your application now while there are plenty of promising property opportunities.
Currently, the minimum requirement for a property investment is €280,000 for low-density population areas, €350,000 for properties over 30 years old and €500,000 for new builds. There are no location restrictions.
The minimum investment will increase to €500,000
Second passport applicants looking to qualify for residence through a fund investment rather than real estate will also be affected by next year’s changes. The minimum qualifying investment will rise to €500,000 from the current €280,000.
The increased minimum investment will also apply to the research and development and company formation options, both rising to the €500,000 level.
This 35% increase in the minimum investment threshold might put the price of a fund investment scheme outside the reach of some people. For others, it means tying up additional capital. Either way, if you are looking to qualify via an investment outside real estate, it is best to apply now.
Remaining unchanged
Two Golden Visa routes will remain unchanged. Starting a company and employing a minimum of 10 Portuguese nationals or making an investment in support of the arts will both continue to require a minimum investment of €250,000. This remains the least expensive option but might not provide the level of investment return.
What to do next
Don’t delay if you wish to take advantage of the most favourable options at a lower level of investment. Due to the hard deadline of 31 December, we expect an increase in application volumes, which may cause a backlog in Portugal. The best way to be sure of a quick trouble (and stress) free application is to apply now and avoid any potential issues.
If you would like to apply for Portugal’s Golden Visa or are interested in our second passport options in other countries, please contact Michele at [email protected] or call direct on +971 50 618 6463.
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