The highly popular Golden Visa scheme in Portugal has now been amended, with the new law, Mais Habitação enacted on the 8th of October removing the category for investment with the purchase of residential real estate to the sum of €500,000.
The categories relating to commercial investment remain in place.
The Golden Visa was initially introduced to revive Portugal’s flagging economy and proved to be extremely successful in this respect bringing an estimated €530 million worth of investments to the country through the scheme. High-income foreign residents bolstered the local economies in the popular areas and the revised Golden Visa scheme has not been welcomed by all in Portugal.
Victor Reis, previously president of the Institute of Housing & Urban Rehabilitation “the problem of the lack of supply of housing is not solved with hostile measures towards those who invest.” Also, the regional President of Madeira Miguel Albuquerque exhibited reservations about the decision.
The category for residential real estate investment, now rescinded, proved so popular with retirees that unfortunately it adversely influenced Portugal’s real estate market driving up property prices, in some areas, such as the Algarve prices rose by as much as 15%.
The inflated costs were elevated to such an extent that Portuguese citizens were priced out of the market by the enthusiastic acceptance of the Golden Visa Scheme by foreign retirees.
Rute Lourenço, an associate at law firm Giambrone, commented “the considerable advantages of the Golden Visa scheme and its can still be accessed through commercial investments enabling the investor to benefit from the extremely favourable rate of tax.” Rute further pointed out “if you have already embarked on the Golden Visa scheme through the purchase of residential property you can still access all the benefits extended at the time of your application.”
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