It has been one of the most successful and controversial residency by investment programs, and in January 2022, it has changed to limit the choice of where to buy.
Here is everything you need to know about the 2022 changes to Portugal’s Golden Visa.
Real Estate Changes
The government has adjusted the visa to spread the investment. The changes limit the locations where you can invest in a property. Although the minimum investment amounts remain the same (500,000€ / 350,000€ for urban renovation), there are geographical restrictions on the qualifying areas.
No longer can you invest in the major cities of Lisbon or Porto or around the coastal regions. In other words, all the holiday hotspots which attract the most attention from foreign buyers are out. Only investments inland and in low-density rural areas will be eligible.
Capital Transfer Changes
The minimum investment thresholds have also been raised both for financial investments and for the number of jobs created:
- Capital transfers are up from €1 million to €1,5 million.
- Investment Fund minimum subscription levels have leapt from €350,000 to €500,000.
- The Research and Development threshold has increased from €350,000 to €500,000.
Meanwhile, for investors looking to support new businesses, the minimum incorporation amount has risen from €350,000 to €500,000, although the number of jobs you need to create remains at five.
Why These New Rules?
Portugal’s Golden Visa had been one of the most popular options for investors looking to buy land or support businesses in the country. They have been credited with injecting millions of euros into the economy but have also become highly controversial.
The EU has urged for a change. For them, the rules that allow people to gain residency over a period of time represent a backdoor shortcut to EU membership. The Golden Visa authorises people to access the right to remain, leading to permanent residence with the European citizenship that comes with it.
Meanwhile, nationally, there were also concerns about the impact of the visa on property prices. Portuguese citizens saw prices inflated beyond their range due to global buyers purchasing up all the land.
It has prompted the government to rethink, but the Golden Visa is proving to be a hard habit for them to shake. Whilst directing people away from those areas which already have high demand, they are now moving them towards other, less popular locations.
What Should Investors Expect From 2022 Changes?
Overall, investors reacted negatively to these new rules. However, there are still many opportunities in the alternative investment markets. Portugal is an incredible country with a relaxed attitude, a good standard of living and a perfect climate. Even away from the tourist hotspots, it offers a great holiday home. And with demand for Portuguese investments rising as a whole, there is also plenty of scope for capital appreciation. All this means Portugal’s Golden Visa still provides great value.
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