The allocation of residence permits for investment in Portugal, the so-called golden visas, has been declining since 2018. And this year the numbers fluctuate from month to month, but are always lower than those recorded three years ago. Restrictions imposed by the pandemic, changes in legislation, delays in the provision of services and competition from other countries are the reasons given by those working in this field for the decline. But they believe that by the end of the year, judging by the requests for information, many deals will still be concluded. The law changes from January 1, 2022.
“There has been a significant decrease in the number of golden visa processes, which does not mean that interest in them has decreased. We had a lot of requests for information, namely about what will change from January,” explains Rita Neto from the Global Lawyers office. , which has an important direction of supporting foreigners.
The possibility for a foreigner to legally reside in Portugal with financial resources has existed since the end of 2012 after an amendment to the immigration law (23/2007, of 4 July). Residence Permit for Investment (ARI) is granted either to transfer capital to a bank based in Portugal; to create jobs or to buy real estate. The latter method is used most often, which means the purchase of a property valued at €500,000, or €350,000 if it is a building that is 30 years old or more. To apply for ARI in this way, all you need is a bill of sale agreement and the value of the deposited property.
The application is submitted to the Foreigners and Borders Service (SEF), which granted two residence permits in the first year of the measure. OUR boom was achieved in 2014 with 1526 golden visas. Last year, 1,182 such residence permits were issued, 63 fewer than in 2019, when the number was already lower than in 2018 (see infographic). And in the first five months of this 2021, there are 378 left.
Rita Neto lists four reasons for this situation: travel difficulties due to the pandemic – “the investor likes to have close contact with real estate” -; problems with money transfers; difficulties with verifying the authenticity of documents at consulates; and delays at the GEF.
Patricia Barao, director of real estate at JLL Residencial, says the main reason for this drop is “constant doubts and threats to terminate the program” that introduce instability that repels investors. “In addition, the Portuguese program competes with similar programs at the European level, so investors have investment alternatives with similar benefits and living standards, and this is a decision you don’t make if there is uncertainty,” he says.
interest materialize
This does not mean that foreign investors do not want to come to Portugal, he stresses. “We feel that the interest of the international market is maintained and even increased, as other markets are paying attention to Portugal, which we did not have two or three years ago. Portugal is now in the spotlight of investors around the world and this is something we can be proud of. Only JLL has sold real estate to clients from 47 nationalities. Naturally, the pandemic gave us more problems in completing the process of buying and applying for a visa (inability to travel, visit, deal with the bureaucratic aspects of the application). Interest remains high, implementation is what takes the longest.”
Expectations confirm those of Rita Neto. “This year there were more contacts with the aim of buying property in Lisbon. I would say that requests for information have increased by 200%, which makes me think that they will be able to complete the process by the end of the year.”
Many of these contacts intend to complete their residence permit application by the end of the year, when they can still buy property anywhere in the country, namely in Lisbon, Portugal’s favorite city today. From next year, only property purchases on the islands and inland cities will be accepted.
90% real estate money
About six billion euros invested in obtaining a residence permit were almost exclusively directed to the purchase of real estate (90.4%). Lisbon is clearly the leader in preferences. Between January 2020 and May 2021, the Portuguese capital attracted 1,012 such investors, nine times more than Porto (112). Cascais is the third city with 104 foreigners.
“With the news that the current terms have been extended until January 2022, we have felt the faster progress of those processes that took time, and the possibility of attracting investors who, due to the time, felt that it was not worth trying anymore. At this stage, it is easier to implement those that customers already know about or have already been to Portugal in the past. There is still huge potential to attract interest and investment in the country, but people will not go further without visiting and knowing. very active and I believe that this program can help reduce the collapse in the public treasury that we are feeling in this pandemic situation,” says Patricia Barao.
Lawyer Miguel Reis is not so optimistic and admits that he is the one who will demobilize such investments for clients wishing to immigrate. “The SEF has all but ceased operations due to the pandemic, eventually granting the same rights as a residence permit to anyone who has expressed an interest. And, on the other hand, the consulates of Portugal were very limited, it was very difficult to obtain the necessary documentation. Anyone who draws up an employment contract and proves that he has the means of subsistence does not need to spend 500 thousand euros, it is enough to have two thousand euros a month,” he argues.
He adds that the pandemic directly or indirectly also has a negative impact on this process. Part of the offices that the company has abroad is closed, namely in Brazil.
profile change
Chinese citizens continue to be the main beneficiaries of this measure, but their dominance is declining, especially in the last year. They still make up the majority of citizens who have been granted a golden visa (50.4%), with Brazil remaining in second place, albeit at a much smaller size. But in addition to the top five, other nationalities are beginning to appear, and not just Jordan and the United States.
Patricia Barao sensed this change in real estate: “Originally we had a lot of Asian citizens, today we have a lot of Brazilians, South Africans, Americans and investors from the Middle East.” And the lawyer Miguel Reis had clients from Iran, Belarus and Yemen.
Clients who are still interested in buying a house in the main cities of the country. Now the goal is for them to invest those funds in less populated areas, but so far there doesn’t seem to be an appetite.
“These things are not done by decree, and most people who apply for a golden visa have an investment rationale and real estate liquidity accounting. Most residential real estate investments are made in cities and on the coast. I also have to take into account taking into account that golden visas have attracted many investors who have nothing to do with the program. , and buying and selling with measurement. We are naturally trying to promote other preferred destinations to golden visa investors and we believe that because of their unique characteristics, the regions of Comporta, Azores and Madeira are very well placed.”
Three immigrants on a visa
This type of residence permit is granted not only to the investor. As is the case with other forms of legalization of foreigners in the country, other people can immigrate on family reunification. In the case of golden visas, this means almost three people for every investment. And not only are they allowed to walk in Portugal, as in the countries of the Schengen zone.
Included are spouses, minors or incapacitated dependent children of the couple; children who have reached the age of majority, single and studying in educational institutions in Portugal; in a straight line and in the ascending line of the 1st degree of a resident or his / her spouse.
The issued residence permit is temporary and can become permanent after five years of continuous renewal in the country. After this period, the immigrant can also apply for Portuguese citizenship through naturalization (Law no. 37/81 of 3 October).
QUESTIONS AND ANSWERS
What does the Residence Permit for Investment (VRI) regime consist of?
This is a measure that has been in effect in immigration law since October 8, 2012. It allows you to legalize foreign investors from countries outside the European Union, hence the name “golden visas”.
What regularization?
You receive a temporary residence permit, which is renewed annually. After five consecutive years of renewal, you are eligible for permanent residence.
What investment?
There are several forms of investment: transfer of at least 1 million euros (will become 1.5 million); creation of 10 jobs in Portugal; acquisition of real estate worth equal to or greater than 500 thousand euros or 350 thousand if they are more than 30 years old.
Is it necessary to live permanently in Portugal?
No, but it must remain at least seven days in the first year of investment and at least 14 days in subsequent years.
Who can benefit?
The investor, but also members of his family who may come to Portugal as part of family reunification.
When was the last shift?
Law no. 23/2007 of July 4, regulating the entry, stay and exit of foreigners, was amended nine times. Regarding golden visas, the latest date is February 12 this year (Decree-Law No. 14/2021), but will only come into force on January 1, 2022.
What will it change?
The minimum amounts are changed, in the case of a capital transfer they are 1.5 million euros, but the main change concerns the location of the facilities eligible for a visa. The condition will be to buy a house in sparsely populated areas and not only in the capital.
What locations?
The property must be located in the autonomous regions of the Azores and Madeira or inland. Eligible places are specified in the supplement to Decree No. 208/2017 of 13 July).
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