In an effort to control property prices, the Portuguese government has confirmed that its real estate residency-by-investment option will be ending shortly. So, with about four weeks remaining for this investment option in Portugal, we look at what’s still out there, and how to get on board in early September.
Portugal is a gem on the Iberian Peninsula, and has long been a sought-after destination for travellers, retirees, and investors alike. With its rich history, diverse culture, and stunning landscapes, it’s no wonder that many are drawn to its shores.
But beyond its natural and cultural allure, Portugal offers a unique opportunity for investors through its Golden Visa program. This program, designed to attract foreign investment, provides a pathway to Portuguese residency and, eventually, citizenship, in exchange for significant financial contributions to the country’s economy.
In this article, we delve into the top three real estate investment opportunities in this beautiful nation. Before diving into these investments, let’s remind ourselves why Portugal is such an exceptional choice for global investors.
Why Portugal?
Perfect weather
Portugal boasts a temperate climate that many find irresistible. With an impressive 2,500 to 3,200 hours of sunshine annually, residents can enjoy an average of 4-6 hours of sunlight in the winter and a generous 10-12 hours during the summer months.
The temperatures are equally inviting, ranging from a mild 8°C in the colder months to a warm 25-28°C in the peak of summer.
World-class healthcare
Health and well-being are paramount, and Portugal doesn’t disappoint in this regard. The country proudly ranks 12th globally for its public health systems, outperforming many highly developed nations such as the United Kingdom, Germany, and Sweden.
Furthermore, the Portuguese are among the world’s healthiest people, a testament to the quality of care and lifestyle the nation offers.
Outstanding education system
Education is a cornerstone of any developed society, and Portugal excels in providing top-notch learning opportunities. The country’s education system is ranked 16th globally, offering free education until the age of 18.
Additionally, Portugal boasts a higher English fluency rate compared to neighbouring countries like France, Italy, and Spain, making it an ideal environment for international families.
Powerful passport
Mobility is a luxury, and Portuguese passport holders enjoy a great deal of it. Ranked 3rd globally, the Portuguese passport offers visa-free or visa-on-arrival access to over 160 countries and territories.
This level of access not only facilitates travel but also opens doors to international business opportunities.
Best destination in Europe
Portugal’s charm is recognised across Europe. Cities like Porto and Lisbon have been named among the best destinations on the continent. Furthermore, the nation is becoming an increasingly popular choice for retirees from the EU, drawn by its welcoming atmosphere and affordable cost of living, which is notably lower than in most European countries.
10-year tax holiday
Established in 2009, Portugal’s ‘non-habitual residence scheme’ is commonly called the best tax secret in Europe. It offers reduced income tax rates (0% in many cases) and exemptions on various income sources for a 10-year period. It targets individuals such as freelancers, pensioners, business owners, and other professionals of high cultural or economic value. The program is tailored to incentivise skilled professionals to make Portugal their primary residence for tax purposes.
HOW TO INVEST?
Last chance for these investment options:
For those considering the Portugal Golden Visa program, the country presents a variety of investment opportunities, but these options are changing by the end of September 2023.
These are three of the most popular real estate avenues:
- A €280,000 investment in property renovation
- A €350,000 renovation of a property that has been standing for 30 years or more
- A €400,000 real estate investment in low-density areas
Why have these options proved so popular? Well, it’s a hassle free, easy in, easy out, way of investing. The three international hotel brands described below are offering a guaranteed buy-back for all investors after five years, along with a publicly registered title deed in your name from day one and a return of up to 4% annually. These are government-approved projects, being promoted only to golden visa investors, debt free.
The EUR 280k option.
- The 5 Star Alvor Beach Resort by HILTON.
The Hilton Alvor Beach Resort is synonymous with elegance and timelessness. Set against a backdrop of lush gardens and natural landscapes, the resort offers panoramic views that stretch from a 50m-long swimming pool, through tropical gardens and pine trees, to the vast expanse of the Atlantic Ocean.
Location: Alvor, on the Algarve, Portugal
Scope: A luxury 5-Star Resort featuring 193 elegant rooms and suites, a regional restaurant, spa, gym, kids club, paddle tennis court, mini-golf course, and a rooftop to savour the golden hours of the sun.
Investment: A EUR 280k investment in this new Hilton resort, will give you a title deed showing you as a co-owner, and offering you a guaranteed buyback in year five (your full EUR 280k being refunded).
Benefits: The IMT (municipality tax of 6.5%) is covered by the developer, as is the VAT on the property purchase, and investors are entitled to a seven-day complimentary stay at this, or another 15 properties built by the same developer.
Timeline: The resort is set to open its doors in the fourth quarter of 2025.
The EUR 350k option, with 3% annual return.
- Madeira Grand Hotel By Marriott.
Nestled in Funchal on the island of Madeira, Marriott’s new Madeira Grand Hotel project aims to breathe new life into one of the city’s most iconic buildings, the existing Golden Gate Hotel. This venture seeks to transform the historic structure into a 4-Star Superior Boutique Hotel, perfectly situated in one of Funchal’s oldest and most picturesque areas.
Location: Funchal Marina, Madeira.
Scope: A 4-Star Superior Boutique Hotel by Marriott, encompassing 78 rooms, a rooftop bar, and a restaurant offering panoramic views of both the city and the ocean.
Investment: A EUR 350k investment in this new Hilton resort, will give you a title deed showing you as a co-owner, will guarantee a 3% return annually, and offers you a guaranteed buyback in year five (your full EUR 350k being refunded).
Benefits: An investment of EUR 350k gives each investor a public title as “co-owner” of the property. The 6.5% municipality tax, (IMT) will be paid by the developer, as will the VAT on the property purchase. The developer will also guarantee a 3% annual return, and a seven-day complimentary stay at this, or 15 other hotel properties, and (most importantly) a guaranteed buyback in year five. Yes, full capital returned.
Timeline: The project is slated for completion in the third quarter of 2026.
The EUR 400k option with 4% annual return.
- The Hard Rock Beach Resort in Algarve
Embodying the essence of the Algarve lifestyle, this beach resort is being built beside the gorgeous sands in Praia do Vau, Portimão. With its prime seafront location, the resort promises a luxurious experience, complete with three outdoor swimming pools, a spa, gym, kids club, and an exclusive private beach club.
An ideal vacation area, the town of Portimão hosts historic ports, a lively marina and is globally known for the Algarve International Autodrome, where the Portuguese Grand Prix was held in 2020 and 2021. The town has some of the best beaches in the Algarve region with extensive sandy coastline paired with calm, warm and clear waters. Vau Beach, where the property will be located, borders coppery cliffs, turquoise waters and a large selection of restaurants offering fresh fish.
Location: Praia do Voy, Portimão, Portugal .
Scope: A 5-Star Hotel flagged by the renowned Hard Rock Hotel brand, boasting 435 rooms, all with breathtaking sea views.
Benefits: The developer covers the 6.5% IMT, VAT is also covered, and investors can anticipate a 4% annual return guaranteed. Additionally, a guaranteed buyback is in place, along with 14 days of complimentary stay here, or at 15 other 5-star Hotels (with some seasonal restrictions).
Investment: A EUR 400k investment in this stunning new Hard Rock resort will give you a title deed showing you as a co-owner, and as mentioned above, the developer will guarantee a 4% return annually and offers a guaranteed buyback in year five (your full EUR 400k being refunded). You can, however, hold the investment for up to 10 years should you not wish to sell in year five.
Timeline: Investors are invited to participate from July 2023, with the project’s completion expected in the fourth quarter of 2025.
Additional benefits of investing in Portugal
While the investment opportunities are undoubtedly enticing, Portugal’s Golden Visa program offers a myriad of other benefits that enhance the appeal of investing in this European haven. Here’s a closer look at the additional advantages that come with choosing Portugal:
Swift residency process
One of the standout features of the Golden Visa program is its efficiency. Investors can obtain Portuguese residence permits in just a single year, streamlining the process of establishing a life in the country.
Free education for children
Portugal’s commitment to education is evident in its provision of free schooling until the age of 18, ensuring that children receive a solid educational foundation.
Protected healthcare system for parents
The country’s robust healthcare system, ranked 12th globally, ensures that parents and families have access to top-tier medical care.
Unrestricted travel within the Schengen area
With the Portuguese residence permit, investors gain visa-free travel access to the Schengen area, encompassing 26 European countries. This facilitates both leisure travel and business opportunities within a vast portion of Europe.
Tax benefits
Portugal offers a favourable tax regime for investors, including no worldwide income taxes. This provision can lead to significant savings and further enhances the financial appeal of investing in the country.
Pathway to EU citizenship
The Golden Visa program is more than just a residency permit – it’s a stepping stone to EU citizenship. Once obtained, this citizenship grants free-visa access to over 150 countries and allows investors and their families to live, study, and work anywhere within the European Union.
Family inclusion
The benefits of the Golden Visa program extend to the investor’s family. After obtaining Portuguese citizenship, the entire family, including children, can enjoy the privileges of living, studying, and working within the European Union.
How Knightsbridge can help
At Knightsbridge, we simplify the complexities of legal, corporate, and immigration processes. Whether it’s legal assistance, corporate structuring, or securing second citizenships through strategic investments, we’ve got you covered. We have assisted over 100 families with their Portuguese Golden Visa applications.
Our wealth management strategies are designed to protect and enhance your assets, ensuring they align with your financial goals. Our commitment to excellence, up-to-date knowledge, and emphasis on trust and professionalism sets us apart.
Reach out to Knightsbridge Group for a free consultation and let us guide you towards success.
Conclusion
The investment options highlighted here, from the luxurious Madeira Grand Hotel to the serene Alvor Beach Resort, not only promise potential financial returns but also offer a tangible connection to the Portuguese way of life. These ventures are emblematic of the country’s commitment to growth, development, and international collaboration.
Whether driven by the pursuit of a better quality of life, the desire for European mobility, or the allure of profitable investments, Portugal beckons with open arms. It’s not just an investment in property or business – it’s an investment in a brighter, more connected future in the heart of Europe.
