Are you thinking of investing in property in Portugal? Find out how Brexit will affect your purchase.

Are you thinking of investing in property in Portugal? Find out how Brexit will affect your purchase.

With the UK-EU trade talks continuing down to the eleventh hour, there are still many questions going around as to what will happen once the UK’s transition period ends at 11 pm on 31st December. And, in particular, what will this mean for those thinking of investing in property in Portugal.

When we all wake up in the new year, there is much speculation as to whether there will have been a no-deal Brexit? This scenario would leave Britain suddenly relying on the World Trade Organisation (WTO) for its rulings surrounding trade. Will the UK find itself in an agreement similar to Canada or Australia, or something completely unique?

If there is a no-deal Brexit, then we can be certain of the fact that the UK will no longer be apart of the single market or customs union. This may extend to the termination of the freedom of movement that currently exists within EU countries. However, there are still many uncertainties surrounding visa-free travel to EU countries, fishing rights, state aid, university funding, roaming charges, and how Brexit will impact the motor and food production industry, as well as property (Property Investor Today).

Portugal is one of the most popular overseas countries for British property investors looking to buy a holiday home. In order to find some answers to how the Portuguese property market may be affected, the Property Investor Today interviewed Bruce Hawker. Bruce is a director at Fine & Country Carvoeiro and is also the founder and publisher of the popular magazine, Essential Algarve. 

One of the big questions that have been asked in regard to a no-deal Brexit is whether Golden Visas will become available to British people. Golden Visas are visas has enabled permanent residence within Portugal for property investors since 2012. The visa extends to a family, including any dependent children, on the condition that their investment is made for a minimum period of five years. The individual must also spend a minimum of seven days in Portugal during the first year of their investment, then a stay requirement of 14 days is required every subsequent two-year period. 

When speaking to Bruce Hawker, he expressed that there is a mixed response to the Golden Visa. Many law firms believe that this could be a possible solution for British property investors; however, personally, he is not sure they will be applicable in the Algarve region. Bruce explained that “what is looking likely at the moment is that [Golden Visas] will be banned in big cities like Lison and Porto and probably in more densely populated areas elsewhere in the country, including some of the Algarve” (Property Investor Today). But nothing has, so far, been confirmed.

Property Investor Today asked if it would be harder for British people to settle in Portugal for long periods of time? It is Bruce’s opinion that the British people will still be welcome in Portugal, and “the Portuguese government will make special concessions to make it easier to take up residency here for Brits than for other non-European nationals” (Property Investor Today).

How will this possibly impact the Portuguese property market?

The property market in Algarve is now stronger and, consequently, less reliable on British property investors than it once was; if there is a no-deal Brexit, the property market will still see interest and sales from elsewhere.

Bruce Hawker explained that at Fine & Country Carvoeiro, “last year we sold to buyers from 21 different countries with the UK making up around 30%. It is our biggest single market, but we do not depend on it. That said, enquiries from UK buyers are currently at an all-time high, and as soon as travel restrictions are lifted, we are expecting to be very busy with Brits.”

He ensured that regardless of Brexit, the market is still very buoyant and still shows signs of growth. Even with the effect of COVID-19, and the expected interruptions to the bookings of holiday lets, the region is still a safe investment. The area is entered into the coronavirus pandemic in a healthy position due to its recent diversified markets. And, the restrictions were lifted back in May, the Algarve region saw a flurry of activity and new investments. The demand for property in the Algarve is still as strong as ever. With the prediction that British property investors will be treated favourably by the Portuguese government and the golden visa on standby, there is no reason why British people cannot continue with their Portuguese property investment.

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