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Golden Visa Portugal: Ways to obtain it and understanding investor’s benefits

Kristina Kurkuliak
16 March 2020

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For the past few decades, the Portuguese Golden Visa program has held its spot as one of the most attractive investor visa programs of the EU. Investors from around the world are eagerly acquiring their second citizenships or residence permits in exchange for investment, i.e., supporting the host country’s economy. More and more individuals whose fortune exceeds $ 1 million turn their attention to European countries.

Residence permit in Portugal is in high demand with investors

Even a cursory look at the statistics will reveal how popular the Golden Visa Portugal program is. Since the launch of the program in 2019 and as of November 2019, almost 22,000 applicants have successfully acquired their Golden Visas. Out of this number, 8,125 are investors themselves, and the remaining 13,862 are their family members. Top 5 nationalities that participated in the program are: China (4,441), Brazil (858), Turkey (374), South Africa (318) and Russia (293). This is not at all surprising. In 2019, PwC, the international audit and assurance, consulting and tax services agency, named Lisbon an ideal city for investing one’s assets in. Many years in a row, the Portuguese Golden Visa is recognized as one of the three leading EU citizenship/residence by investment program. Why are investors so interested in Portugal’s residence by investment program? Immediately, economic stability comes to mind. However, that is not all.

Why are investors so interested in obtaining Portugal’s residence permit?

Portuguese Golden Visa grants certain advantages to the investor and their family members. Let’s list them below:

Do you still have doubts that the Portuguese Golden Visa program is the best option for you? You might find that other European countries also boast attractive options. Let’s compare the Portuguese Golden to some other similar programs.

Existing European residence by investment permit programs

The cost of Portugal’s Golden Visa doesn’t differ that much from its European competitors. Only Greece and Spain stand out on the list:

It should be noted that all of the above countries have a fairly well-developed tourism sector. Greece and Spain, however, went through their respective crises several years ago and are still recovering from its consequences.  The Portuguese economy, on the other hand, is stable, and the standard of living is on the rise. Still, the main advantage of the Portuguese Golden Visa is the possibility to obtain a passport after 5 years of holding the permit. In contrast, other European countries that exchange residence permits for investment have stricter rules when it comes to citizenship. Let’s compare European residency by investment programs in the table below.

  Portuguese residence permit Greek residence permit Spanish residence permit Malta’s permanent residence Cyprus’ permanent residence
How long it takes From 12 to 16 weeks 8 to 20 weeks 16 to 28 weeks 12 to 36 weeks 12 to 20 weeks
Minimum investment threshold At least €350,000 At least €250,000 At least €500,000 At least €330,000 At least €300,000
Obligatory stay in the country – One week within the first year of holding the Golden Visa
– Two weeks for the next two years
One week per year For those planning to apply for permanent residence None None
Extending residence permit Staying in Portugal for a specified amount of time Must keep ownership of the real estate One-time visit will suffice Complete the paperwork No extension require, issued for life
Applying for citizenship A week-long stay every year for 5 years, i.e., 35 days in total No special conditions for holders of temporary residence permits. Citizenship is obtained only through naturalization after at least 7 years Staying in Spain for at least 6 months annually. One may apply for citizenship in 10 years’ time To reside in Malta for 5 years, provide proof of ties with the country No special conditions for holders of temporary residence permits. Citizenship is obtained only through naturalization after 7-10 years
Special taxation conditions for foreign investors Non-Habitual Resident tax system None None Malta Non-Dom Status None
Is it necessary to be personally present in the country to get the permit extended? Travel to Portugal to open a bank account Travel to Greece in order to obtain one’s residence permit Travel to Spain in order to obtain one’s residence permit In the final stages of the procedure, of-age applicants are required to visit Malta Travel to Cyprus in order to obtain one’s residence permit

European citizenship by investment programs

For some investors, obtaining just a residence permit is not enough, since a passport would be more helpful for their needs. But it’s no easy feat: there is no program yet that would allow one to obtain Portuguese citizenship by buying real estate or through subsidies. There are, of course, some alternatives. Namely, there are two European citizenship-by-investment programs that stand side-by-side with Portugal’s Golden Visa one. See cost comparison below:

In 2020, Greece was planning to launch its own Citizenship by Investment program. According to preliminary information, the cost of the passport might have been around €2 million. As you can see, prices for European citizenship differ, but even the lowest offer (the Maltese program) fluctuates around €1 million. In the meantime, the Portuguese Golden Visa program will still allow you to obtain the desired passport. There are no special requirements set by the government. It is only necessary to stay in Portugal for a week within a year. After 5 years, you as an investor will be eligible to apply for permanent residence or, more boldly, for Portuguese citizenship.

Note: Let’s all forget the wording “Portuguese citizenship by investment”; there is, officially, only the Golden Visa program, which is equivalent to a residence permit.

  Portuguese residence permit Citizenship of Cyprus Citizenship of Malta
How long it takes 12 to 16 weeks 12 to 24 weeks 1 year or a bit longer
Minimum investment threshold At least €350,000 At least €2,150,000 At least €880,000
Visa-free countries Schengen Area 173 countries, including the US & Canada 183 countries, including the US
Obligatory stay in the country – One week within the first year of holding the Golden Visa

-Two weeks for the next two years

None None
Extending residence permit/citizenship Staying in Portugal for a specified amount of time Issued for life Issued for life
Applying for citizenship A week-long stay every year for 5 years, i.e., 35 days in total Own a residential real estate object worth at least €500,000 Own government bonds and real estate for at least 5 years
Special taxation conditions for foreign investors Non-Habitual Resident tax system Lowest corporate tax in Europe, 12.5% Malta Non-Dom Status tax system
Is it necessary to be personally present in the country to get the permit extended? Travel to Portugal to open a bank account Travel to Cyprus in order to obtain one’s residence permit In the final stages of the procedure, of-age applicants are required to visit Malta

Portugal residence permit: Investment options

The government provides several options for those wishing to apply for a residence by investment in Portugal. Let’s take a look at each of them. Purchase of real estate Many investors prefer to apply for Portuguese Golden Visa through buying property. Indeed, this option will allow you to have a source of passive income. In addition, the cost of real estate is steadily growing in Portugal, and over time, the object can be profitably sold. One can select from the following investment options:

https://youtu.be/FZnQwfwyFAg We will take a closer look at this investment option in a section below, and now, on to other available investment options. Opening a deposit and purchase of securities If you do not wish to spend extra time on choosing and buying real estate, you may be interested in making a deposit or purchasing securities. It is also possible to invest in government-approved projects. The options are as follows:

Irrevocable investment Some investors prefer this option. Above all, such type of investment lifts any additional reflections or commitments. The applicant receives their Golden Visa in exchange for investing:

If any of the above activities are carried out in a less popular area of the country, the required investments can be reduced by 20%. Starting a business It is also possible to obtain a Portuguese residence permit by creating a certain number of jobs. It is necessary to establish a business in Portugal (start a new one or branch out). A minimum of 10 jobs are expected to be created through business. In this case, the amount of investment can also be reduced by 20% if the activity is carried out in a less popular area.

Obtaining Golden Visa Portugal through the purchase of real estate

If this is your preferred option, it’s time we learn more about prices on the country’s real estate market. Lowest prices The cost of real estate in Portugal starts at €42,000 for the finished object, and at €22,000 for a territory with a development plan. Seems quite reasonable, doesn’t it? However, there are certain rules and regulations tied to obtaining Portugal’s Golden Visa through investment. The value of real estate should reach at least €350,000 for an object aged 30 years and above, and requiring reconstruction, or at least €500,000 for any object of your liking. Reconstruction For a better understanding of the offers available on the Portuguese market, here is an example of a typical €350,000 real estate object:

Obtaining Golden Visa Portugal through the purchase of real estate

Almancil

In most cases, however, the above price most likely means you will get  rather dilapidated object instead of a place that is ready to welcome new residents. But you still might catch some nice offers. For instance, here’s a duplex villa for the price:

The cost of real estate objects in good condition starts at €500,000. Here’s what one can typically expect to get for the price tag:

In addition, it is possible to purchase the adjacent neighboring building in this particular option.

Excellent condition

Not everyone is interested in doing renovations. If this is about you, we’d recommend investing in brand new, or nearly new, real estate, or in objects that have aged well. There are many interesting options for €500,000 and above on the Portuguese real estate market. A 3-bedroom villa:

Property in Portugal: 3 bedroom villas

And although this is a secondary housing, the villa is in great condition and equipped with the latest technological items. Of course, the beach is within walking distance, too. A 2-bedroom villa:

This villa is new and fully furnished, complete with a dishwasher, fridge, microwave, washing machine and air conditioning. The energy saving level is A. The infrastructure is well developed in the area: it is possible to reach the center of Lisbon in just 30 minutes, and be at the Lisbon International Airport in 20 minutes. The villa overlooks the river and the sea. A 2-bedroom apartment:

It’s a brand new luxury apartment. The kitchen is equipped with Bosch appliances. The level of energy saving is A. There is a suspension platform in the building that offers a breathtaking view.

Note: As a rule, in new apartment buildings, you can choose apartments with more bedrooms. Naturally, the cost of such an apartment will be slightly higher.

Some developers offer to purchase objects under construction for about €500,000. This doesn’t seem like the most convenient option, since you will have to wait until the project is complete. And if you are looking for real estate with at least three bedrooms, or larger square footage, we suggest considering options that start at €520,000. A 6-bedroom villa:

There is a home cinema, a relaxation area, a games room and a laundry room in the basement; a jacuzzi and a large terrace on the ground floor. The kitchen is fully equipped. The villa has air conditioning, solar panels and central heating. It was previously lived in. Located in the area with well-developed infrastructure.

Property in Portugal

A farm:

The farm has previously been lived in. The guest house has recently been renovated. This place farm is perfect for an investor who would like to set up a business related to organic farming or rural tourism. Energy Saving Level is E.

In conclusion

Several ways exist to obtain European citizenship. Still, being issued a passport as a holder of Portugal’s Golden Visa remains the most advantageous option. After all, this will allow you to become a resident of one of the European countries, as well as to acquire liquid real estate.  The real estate in your possession can be rented out (since Portugal is very popular with tourists), and eventually sold. Most importantly, the holder of the Portuguese Golden Visa will obtain the country’s passport in 5 years’ time effortlessly and with zero additional investments.  If all of this makes Portugal an ideal destination for you, and you have decided to obtain the Portuguese Golden Visa through investing in real estate, the one thing left to do is to choose the right object for you. You are free to choose an object with a cost that aligns with the minimum cost threshold, or a more expensive one. The real estate market is full of various offers. The cost will vary depending on the remoteness of the object from the city center, the development of infrastructure and the number of rooms.

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