Greetings to all readers of the MoVeToCasciasis blog. Today, December 22, the Portuguese government approved a new law that changes the legal regime of residence permits for investment (ARI), which in recent years has served as an engine for real estate. The new rules restricting the issuance of golden visas in the greater Lisbon area (including Cascais) and Porto, as well as on the coast (especially in the Algarve), will take effect July 1, 2021. Let’s find out what this news brings to the plans of future investors and whether it imposes any restrictions on obtaining a gold visa for Portugal in 2021.
So what do the new changes to the ARI legal regime mean for us? Foreign investment going into the interior of the country and the islands will now be encouraged. The aim, among other things, is “to promote foreign investment in regions of low population density, namely in urban redevelopment, in cultural heritage, in activities of great environmental or social importance, in productive investment and job creation. There have been rumors of this since February 2020, but the pandemic delayed the rule change.
Because of the current crisis and the importance of golden visas for real estate, the government decided to introduce a transition period for the sector, instead of taking effect at the beginning of the year as originally envisioned.
The measure provided for in the legislative decision will be gradually introduced from July 1, 2021, until the end of 2022. This means that during the transition period, those interested in obtaining a residence permit in exchange for investments in real estate in the metropolitan areas of Lisbon, Porto, and the coast will be able to continue to enjoy the benefits of the current regime. During this period, the amounts required from investors to access golden visas will gradually increase, and the possibility of applying to the metropolitan areas will be reduced.
What has been achieved under Portugal’s golden visa program?
Real estate has brought most of the investments made on golden visas. The law now specifies that the purchase of real estate is made for a value of at least 500,000 euros, or the purchase of a building over 30 years, located in an urban rehabilitation area and renovated for a total of 350,000 euros.
In November, 86 residence permits for investment were issued, 80 of which were for the purchase of the real estate. As for the volume of investments, last month it increased by 35% compared to the same period in 2019 to 50 million euros, according to a report based on SEF statistics. Relative to October, the increase was 75%.
A total of 9,340 golden visas have been issued in those eight years, with an investment of 5,611 million euros. Of these amounts, 8,782 visas and 5,071 million are related to real estate.
Status of the program today and projections for 2021
With the entry into force of the new regulations, foreign investment, which until now was mainly related to real estate, especially in large urban centers and major tourist areas, is starting to go to inter-municipal communities (CIM) in the interior and autonomous counties, as well as to increase investment in activities that contribute to job creation.
So far, only 17 visas have been issued for the creation of ten jobs and three (two of them in October this year) for the transfer of 350 thousand euros related to the creation or strengthening of company capital and the creation or maintenance of five jobs.
There are still two categories that have failed to attract a single investor: one, to increase the threshold of entry into the zone of Lisbon, Porto, and the Algarve, requiring a minimum investment of 250 thousand euros in artistic production, and the other, requiring a minimum investment of 350 thousand euros in scientific research.
As far as I am concerned, the new changes do not impose any serious restrictions but are only intended to increase the threshold of entry into the Lisbon Porto and Algarve zones. In any case, persons interested in obtaining EU citizenship with a golden visa should hurry, because Brussels’ pressure on the countries issuing passports for investment programs has already led to the closure of such opportunities in Cyprus and, apparently, in Malta soon.
Author: Stanislav Tkachenko