The golden days of people from all corners of the world moving to Portugal could soon be coming to an end. Since October 2012, the country has been granting a residence permit to foreigners who invest between €350,000 and €500,000 in the purchase of a property or the creation of jobs in Portuguese territory. In the decade that the Golden Visa has been in force, 11,180 visas have been granted and it has raised about 6.6 billion euros. Despite this, the Portuguese government considers that it is “no longer justified” and has decided to put the program under review.
This measure is most likely the response of the Prime Minister, Antonio Costa, to the rising cost of housing in Portugal. 92% of all visas granted have been obtained through the purchase of real estate and this has been felt in their value Between April and June, the price of houses increased by 13.2% compared to the same period in 2021, representing the biggest annual jump in the last 12 years, according to data from the Portuguese National Statistics Institute. It is worth mentioning that foreigners paid on average €831 more per square meter than residents.
Until recently, most of the foreign investors who obtained this type of visa came from China. However, Americans have overtaken them this year. In total, 162 U.S. citizens obtained a residence permit between January and September, compared to 160 visas granted to Chinese, according to data from Portugal’s immigration service. In Lisbon – the Portuguese city with the highest price, 2,706 euros per square meter – they were the second largest foreign home buyers, behind only the French.
Another reason would have been their possible use for money laundering, a concern expressed by both European Union officials and members of the Portuguese left. The Left Bloc, for example, assured in a message on Twitter that “gold visas only serve the oligarchs who want to launder their fortunes. They do not serve the population of any part of the country, they only harm it”. To which the Portuguese Communist Party added that the new residents were not helping to stimulate the local economy.
The possible end of this regime has sown uncertainty among real estate developers and has led them to look to other markets, such as Greece. However, they will find themselves in a very similar situation. Greece’s Prime Minister, Kyriakos Mitsotakis, doubled in September the minimum amount required to obtain a residence permit in the country from €250,000 to €500,000, “in order to increase the affordability of real estate for Greeks,” according to International Adviser. And the same has happened in Turkey, where the required investment has increased by more than €144,000 to €385,000. Spain also has such a visa, which is obtained in exchange for 500,000 euros.
Visa for digital nomads
The news comes shortly after the digital nomad visa came into force. This visa is available to people with jobs who can prove that they earn at least 2,820 euros, i.e. four times the current value of the national minimum wage, currently at 705 euros.
With this new visa, the Portuguese Executive intends to maintain the flow of residents that started the arrival of the pandemic and teleworking. According to António Costa, digital nomads are essential “to have a country that is increasingly innovative and with companies that grow on a global scale”.
Those who obtain this visa will be able to reside in Portugal for one year. Should they wish to extend their stay, they will be able to do so by applying for residency. It is also open to Portuguese nationals who have not been tax residents in the country in the last five years.
