Portugal’s so called Golden Visa which gives overseas property owners a residency visa is tempting buyers from Asia to invest in residential and commercial real estate worth up to €100 billion by 2014. The new residency package, brought in by the government last year to boost the country’s economy, is aimed at non European Union nationals and has been particularly attractive to the Chinese market. Spain is now following suit and introducing a property residency visa next year.
Portuguese real estate agent Fine and Country Cascais has seen Chinese buyers generate €25 million in just two and a half months that would otherwise not have existed. Following this trend, they are now collaborating with Portuguese schools, banks and industry giants to promote moving to Portugal.
There are now 43 countries with similar visa schemes with varying conditions. One of the reasons why the Portuguese visa has been such a success is the flexibility of its conditions. By investing €500,000, foreign nationals outside the EU are able to live in Portugal under a five year temporary residency permit, which after that time, allows the application for permanent residency along with their immediate family.
The Chinese are already keen on investing in Europe with figures suggesting that the Chinese have invested 21% more in the continent in 2012 than in 2011. China’s Private Wealth Report indicates that 40% of Chinese billionaires are already involved in emigration investment.
As the move by Cyprus proved last year, securing permanent residency in an EU country is a major attraction for Chinese buyers, so far investing €1.6 billion into residential property. Recent estimates back this up; showing that around €144 billion has been pouring out of China each year since worries spread about slower economic growth and falls in the value of stock and property.
‘Investors are flocking to buy Portuguese property as an insurance policy for any future political instability in China. Property here has been a safe way to store equity, a great international hub for foreign education and is now an ideal time to invest in business and industry while capital is low,’ said Charles Roberts, managing partner of Fine & Country Cascias. ‘The Chinese already own 40% of the National Grid and are likely to snap up other privatised industries such as airlines, agriculture and ship yards. External investment like this has been well received. Not just financially, but as a community Portugal has historically welcomed foreigners and consequently has a great cosmopolitan atmosphere. Entrepreneurs are received as a great contribution to the tourist economy,’ he explained.
‘By cutting the red tape on foreign investment, the Portuguese government will reap the rewards of prioritising Foreign Direct Investment. With all measures recognised by the European Commission, United Nations and the World Bank, Portugal is in a perfect position to open up more opportunities for sellers and buyers and increase international confidence in the economy,’ he added.
Visas are not the only attraction for property investors. Portugal was recently voted one the best places to invest, work and live. ‘The Portuguese Riviera around Estoril and Cascais has always been popular for international residents, sitting right next to the capital, near NATO bases and diplomatic communities. The area has five international schools each with over 1,000 pupils. Property prices are at a low, but the gains are still high,’ said Roberts.
He believes investors see that confidence in Portugal is returning and opportunities exist. Investment in Portuguese real estate rose 68 % in 2012 and is likely to continue growing, he pointed out.