David Moura-George, Director of Portugal at Athena Advisers, and Joana Martins Farinha, a partner from Legal Square, explain the upcoming changes to the Portuguese Golden Visa programme and share a selection of eligible Golden Visa properties for sale in Lisbon.
The Portuguese Golden Visa programme was launched in 2012 to help the country attract international investment during the economic crisis. To date, the Golden Visa programme has raised more than €5.6bn in investment and more than 26,000 investors and qualifying family members have applied (SEF). Though the changes were only confirmed at the start of 2021, it was announced in 2020 that the Golden Visa programme will be changing, this created a surge in demand for Golden Visa properties over the past year. Despite the effects of COVID-19, €647m was invested in the Golden Visa programme in 2020.
Now confirmed by the Portuguese government, the Golden Visa programme will be changing from 1st January 2022.
The minimum thresholds for certain investments will increase. At the moment, those who invest €350,000 or more in a qualifying fund are eligible for a Portuguese Golden Visa. However, next year the minimum sum of investment will rise to €500,000. Several other investment options will be affected too.
Redefining the areas where residential property investments can be made. From next year, those who buy a property in Lisbon or Porto will no longer be eligible for the Portuguese Golden Visa programme. However, residential property in the Azores, Madeira and the interior of the country will still be eligible next year. It is also important to stress here that this change will not affect commercial property so those buying a commercial property in Lisbon next year will still have the option to apply for a Golden Visa.
2021 – minimum investment required
2022 – minimum investment required
As the Golden Visa programme is changing at the end of the year, those who want to access it by investing in Lisbon or Porto real estate should aim to purchase their property and begin their application by the end of August at the latest. This is because it takes the immigration office around 90 days to pre-approve applicants and it is only after this pre-approval that investors are formally considered to be part of the programme. By investing early, clients will have a safety buffer in case any problems occur.
There is a limited supply of Golden Visa properties in Lisbon. Whilst the upcoming changes have increased the demand for Golden Visa properties, the pandemic has had an impact too. Joana comments that she has many clients from countries that haven’t handled the pandemic well who are looking for a plan B or another place to stay should future lockdowns occur.
Most people apply for a Golden Visa by investing in Portuguese real estate. The minimum investment is €350,000 or €500,000 depending on the type of property. Properties that are older than 30 years and located in regeneration areas can often qualify for the lower rate of €350,000 if the property is being renovated. However, €350,000 Golden Visa properties in Lisbon are increasingly hard to find.
Fast track to residency for investors and their immediate family: once the investor has purchased a qualifying property, they can apply for residency immediately and include qualifying family members in the same application.
One of the biggest advantages of the Golden Visa programme is that once you have your Golden Visa, you can enjoy hindered travel throughout the Schengen zone.
One of the best things about the Golden Visa programme in Portugal is that investors will only need to spend, on average, seven days a year in Portugal. It is up to you whether you want to spend a week in Portugal or break it down into several shorter stays.
At the end of the fifth year, you will have the opportunity to apply for full Portuguese (EU) citizenship, permanent residency or you can renew the Golden Visa for a third and final time. Joana comments that after the fifth year most clients chose to apply for citizenship.
Once the investment has been made, the online application for the Golden Visa can begin and clients will need to pay the initial analysis fee. This whole process typically takes around three months and you will receive a document to say that you have been pre-approved for the Golden Visa programme after the third month.
Once you have this pre-approval, it is then possible to arrange the next steps, such as the collection of biometric data and the submission of the physical documents. Joana explains though it may be more convenient to book an appointment at a Lisbon Immigration Office, it isn’t always the fastest route as approvals here can take 14 – 18 months. Instead, Joana recommends that clients go to an immigration office in a smaller town as the approval process usually takes around six months or nine months at the most.
Once the application is approved by the immigration office, your residency cards can be collected by your lawyer and forwarded to your home address.
One of the great things about the Golden Visa programme is that investors can add certain family members to their Golden Visa application. Qualifying family members include:
This is one of the most common questions which Joana receives and the costs, all of which are payable to the Portuguese government, have been broken down below:
Immigration application fee: €533 per person
You will need to pay this fee right at the beginning of the process in order to submit your online application and you will also need to pay this fee again when you apply for your first and second renewals of the Golden Visa programme.
Immigration office approval fee: €5,325 per person
This must be paid for the first approval, but, fortunately, the rate is reduced for future residency renewals.
Residency renewal fee: €2,663 per person
Following the current timeline for the programme, you can expect to renew your residency every two years.
Disclaimer: It is important to remember that the government can change these fees on a yearly basis. Normally, it is not a huge change just a slight increase of a few cents or a couple of euros.
There are plenty of reasons to invest in Lisbon, David Moura-George highlights that these are the five main motivations for international buyers:
Lisbon is now the official home of Web Summit, the largest technology conference in the world. Not only does this further cement Lisbon’s reputation as a major tech hub but it is expected that this will bring in an additional €2bn of revenue to the economy over the next decade.
Lisbon is the future home of the largest start-up hub in the world, Hub Criativo do Beato, which is located in Marvila and will span 100,000 sqm upon completion.
Google and other major international companies such and BNP Paribas are opening offices in Lisbon and creating more jobs.
It is not only businesses that are driving Lisbon forward, but the government is investing €23bn into public infrastructure. This includes the creation of a high-speed rail link between Lisbon and Porto which is set to be delivered by 2030.
In 2023, a brand new airport will be opening in Lisbon which will welcome 43 million visitors a year, doubling the city’s flight capacity.
Studio – 2 bedroom apartments from €350,000
What makes this property so exciting is that many of the apartments allow investors to apply for the Portuguese Golden Visa programme by investing €350,000 instead of the standard €500,000. Opportunities like this are quite rare in Lisbon. The property is located on a narrow street in Santa Catarina which is within walking distance from many of Lisbon’s best sights and neighbourhoods including Jardim da Estrela, Príncipe Real and Chiado.
One-bedroom apartment / €530,000
Located in the prime historic centre, this apartment is an ideal pied-à-terre or a buy-to-let investment with an estimated monthly rental income of €1,150. Baixa is one of the most popular areas in Lisbon as it is home to some of the city’s most famous attractions such as Praça do Comércio.
One-bedroom apartment / €510,000
Located in bohemian Bairro Alto, this one-bedroom apartment is sold fully furnished which means that it is ready to move into or rent out straight away. It has a convenient location with bars, restaurants and public transport links within walking distance.
2-4 bedroom apartments / from €500,000
Perfect for families moving abroad, Splendid Beloura offers amazing value for money with an average price of €3,100 per sqm. A real family-orientated town, Beloura is nestled between Sintra and Cascais and is just 30 minutes’ drive from Lisbon. Last October, TASIS opened an international school literally a minute’s walk from the project. This is very exciting for Beloura as the opening of an international school will have a positive effect on the value of the local real estate. We have seen this happen before in other locations. Plus, the new school will boost demand for rental accommodation as teachers will be looking for high-quality accommodation nearby.
What happens if I apply for a Golden Visa but I am unable to travel to Portugal to submit the biometric data due to travel restrictions?
In the past, applicants had to submit their biometric data within six months of their pre-approval. However, this is no longer the case. At least until the end of 2021, there is no deadline for submitting biometric data which is great news given the various travel restrictions in place.
Is the Portuguese Golden Visa the same as a D7 Visa?
No, it is not. The Golden Visa is an investment programme whilst the D7 is a residency programme. For the D7 Visa, you are required to reside in Portugal whilst for the Golden Visa you will only need to stay in Portugal for, on average, seven days a year.
From 2022, properties for sale in Lisbon will no longer be eligible for the Portuguese Golden Visa programme. How is Lisbon defined – is it just the city centre?
The restrictions are on the larger Lisbon area, not just the city.
Is it possible to submit biometric data via the Portuguese Embassy in my home country?
No, you will need to travel to Portugal and visit an immigration office to submit your biometric data and physical documents.
Is it possible to pay for Athena Advisers services without buying a property through Athena Advisers?
Absolutely. Please do get in touch to learn more about our client services.
What happens if I apply for a Golden Visa for my child and they become financially independent during the five year period?
If the child is no longer dependent, leaves education or gets married, the immigration office will cancel their Golden Visa.
What is the age limit for children when applying for a Golden Visa?
21 years old. Plus, for the next five years, they must remain economically dependent, unmarried and in full-time education.
Are the fees for the Golden Visa charged per family unit or per person?
The fees are charged per person.
If my brother and I purchase a Golden Visa property for €350,000 can we both apply for a Portuguese Golden Visa or would we need to invest €350,000 each?
You will need to invest €350,000 each as siblings are not classed as qualifying family members.
If I apply for citizenship after five years, am I allowed to sell my Portuguese property or must I maintain my investment?
Yes, once you become a citizen you are free to sell your property. To ensure that your application goes ahead smoothly, Joana advises that you maintain the investment whilst you wait for the citizenship application to be approved and only sell your property once you have received your passport. At the moment, the approval process takes between 18 months and two years.
Commercial property sounds interesting, can I apply for a Golden Visa by purchasing a commercial property in Lisbon?
Yes, commercial properties in Lisbon are eligible for the Golden Visa programme and will continue to be eligible next year. Only residential properties will be affected by the upcoming changes.
Is the €350,000 or €500,000 minimum investment based on the value of the property or the actual sale price?
It is based on the purchase price.
What taxes apply during residency?
It’s hard to give an exact answer for this one as it depends on whether you are a tax resident in Portugal, the type of investment you make and whether you have any income in Portugal.
Is August 31st the last date to buy the residential property and start the Golden Visa application if I want to invest in Lisbon?
Joana advises that this is the latest date investors should begin the process if they do not want to be impacted by the changes which come into effect in 2022. Investors should purchase their property in Lisbon and pay their initial application fee before this date.
How is commercial property performing in Portugal?
Last year was the third-best year in terms of commercial property sales with €2.8bn+ invested. Whilst the high street has been affected by Covid-19, it is important to remember that the commercial sector encompasses a whole range of properties including supermarkets, offices and logistics (warehouses etc.) which has boomed in Portugal over the past year. Take a look at our commercial property market update to learn more about commercial property trends in Lisbon.
How much is inheritance tax in Portugal?
No inheritance tax needs to be paid on inheritance from parents to children.
How much time must I spend in Portugal in order to qualify for a D7 Visa?
You must spend at least four months during the first year and in the subsequent two years, you must spend a total of 16 months in Portugal. The Golden Visa is much more flexible as you only need to spend, on average, seven days a year in Portugal.
I am a US citizen – what are the advantages of becoming a Portuguese citizen?
The main advantage for US citizens is that they can apply for a Portuguese (EU) passport.
I’m interested in commercial property in Lisbon – could you tell me a bit more about the logistics market?
Over the past year, Covid-19 has meant that more and more Portuguese people are buying products online. In fact, online sales have tripled over the past year. This has led to increased demand for logistics properties such as warehouses. See our Portugal commercial property market update for more information.
Regarding citizenship, should one begin the application process only after five years of Portuguese residency or can I start the process earlier?
You can only request citizenship once you can prove five years of valid and legal residency in Portugal. As you need a document from the immigration office to prove this, you cannot start the citizenship application any earlier.
Are the Portugal Golden Visa and NHR (non-habitual resident) programmes related?
The NHR programme is not related to the Portuguese Golden Visa programme and will not have any impact on your citizenship application. You can apply for both the NHR programme and the Golden Visa at the same time but do note that you must spend at least 183 days a year in Portugal to qualify for the NHR programme.
In order to apply for a Portugal Golden Visa, does the property need to be owned by one family member or may a couple purchase it together?
Under Portuguese law, the investment must be done in the name of the investor. In Portugal, there are three common marriage regimes. One of them is the ‘jointly acquired assets’ regime and this is the one Joana normally recommends clients to state in the documents as marital agreements worldwide are not all the same. If it is stated in the power of attorney that you and your partner are married under the ‘jointly acquired assets’ regime, regardless of whose name is stated on the documents, the property will be owners in equal parts of 50% by each spouse.
What are the obligations of Portuguese citizenship eg. voting, national service and tax?
There are no obligations.