May 11, 2020

The New York Times: Portugal Golden Visa (Residency Permit) through Investment in Porto

The New York Times has recently stated that the Portuguese Golden Visa program remains an open door to the European residence or citizenship by investment. Real estate in the northern city of Porto, Portugal, is recommended as an excellent basis for obtaining a valid Portuguese temporary residency title (e.g. the Portugal Golden Visa).

Portugal is a highly developed European country with state-of-the-art medical facilities and plenty of opportunities for quality education. With the spread of the COVID-19 risks around the globe, public health concerns and security rightfully took precedence over all other priorities. Therefore, the Portuguese temporary residency title and citizenship by investment in Portugal may meet the most challenging aspirations for a safer place with promising returns on investment. 

Porto is an actively developing city offering a wide range of housing as well as commercial property. When you buy real estate in Porto, you get both quality housing and a residence permit. The Portuguese residency status granted through the Golden Visa program allows the holder to travel throughout the EU Schengen zone.

Having got the Golden Visa Portugal, you will be entitled to the right to obtain (in five years after the deal) a Portuguese passport with the EU citizenship and permanent residency. Portugal citizenship can be granted without the applicant having resided in the country, a 35-day-stay would be sufficient. Citizenship of Portugal and a second passport conveys the right to live, work and study anywhere in the European Union.

Experts believe that the simplest way to get EU citizenship in 2020 is offered by Portugal

Moreover, since May 2013 the OECD has listed Portugal as one of the top countries in the world to buy and own real estate. 

In a recent article about real estate in Portugal, and in particular, in Porto, The New York Times journalists state, with reference to local real estate agents, that Porto attracts quite a significant share of solid foreign investment, and the more is yet to come.

Residence by Investment in Portugal: Porto Property Market Review by The New York Times

The New York Times report outlines the following reasons for the Porto’s increasing popularity with investors:

Location, sights, and infrastructure: Porto (also known as Oporto) is a metropolitan area with a population of about 1.3 million people. It is the second-largest city in Portugal after the capital of Lisbon. Located in the Douro River estuary in northern Portugal, this urban city stretches along the Atlantic coast, enjoying great seascapes and landscapes. Porto is one of the fastest-growing European tourist destinations, famous for its magnificent nature and rich culture. Its Historic Centre is classified as the UNESCO heritage site. Oporto is often referred to as ‘Cidade das Pontes’ (City of the Bridges), ‘Cidade Invicta’ (Unconquered/ Invincible City), and ‘Capital do Norte’ (Capital of the North). The modern Porto International Airport is just half an hour away from downtown. 

Development and renovation throughout the city: Over the past decade, the Old City attracted significant public and private investment, which has driven profound renovations. The recent boost of new construction and refurbishment of existing properties has been slowed down by the global pandemic. However, before the crisis, a strong foundation and mechanisms had been established to further the city’s renaissance as a strong player in the market.

The influx of large job-generating enterprises: Foreign companies see Porto as an open and safe place to do business. In recent years, the image of the city has improved significantly, which attracted high-tech companies such as Vestas, a manufacturer of wind power plants. The article in The New York Times compares Porto and California and finds similarities in their dynamics of high-tech business development. Many investors are eligible for the Golden Visa by creating at least 10 jobs for the Portuguese, or by donations into a Portuguese research fund. However, property acquisition seems to be the best of all options, as thanks to the robust real estate market, returns on that investment are always high.

The New York Times report mentions a three-year trend observed in the historic center of Porto: the 20 percent year-by-year price increase in the luxury housing segment. Now the value of such assets starts at 300,000 euros ($325,000) and averages 650,000 euros ($705,000). Houses in the prestigious coastal area of Foz do Douro can sell at 3 million euros ($3.26 million). 

As for the housing market in general, the National Institute of Statistics of Portugal (Instituto Nacional de Estatística; INE) reported an annual increase of 9.6 percent in housing prices in 2019. This is a very impressive result, although in 2017-2018 the growth rate of property prices in Portugal was by about 0.7 percent higher. 

Housing prices in Portugal last year rose by 10.1 percent in the secondary property segment and

by 7.6 percent in the segment of housing under construction or recently built projects. As of November 2019, apartment prices had risen to an average of 1,402 euros a square meter ($142 a square foot), while house prices had risen to an average of 1,162 euros a square meter ($117 a square foot).

Last year, according to INE, in the northern region of the country, which includes Porto, there were 39.3 percent of all permits granted in Portugal for the construction of real estate of all types, as well as 42.9 percent of all licenses for the construction of new family homes.

However, INE experts remark that these figures do not reflect the current status of the market

affected by the COVID-19 pandemic. Nevertheless, they expect that the current trends are going to change for the better.

Representatives of Portuguese property companies interviewed by The New York Times and other realtors noted that while the pandemic has become a top priority for the national health care system, it has also served as a test for the Portuguese economy, including the real estate sector. As for immediate assessment of the current property market status, it is rather optimistic.

The Porto real estate market has established its reputation as a dynamically developing and

transparent market before March this year. Of all catalysts of its recovery, the demand for Golden Visas can promises perhaps the most agile growth. 

Residence by Investment in Portugal: Porto Property Buyers Profiled by The New York Times

The New York Times article highlights the main categories of buyers of the Portuguese Golden Visas and residence by investment in Porto:

– The country’s convenient position in southwestern Europe is favorable for travel and business

links with Africa, Europe, and the American continent

– Porto has been popular with British and French buyers for such a long time that it is also home to several reputable international schools, including the oldest British school in mainland Europe. The English-speaking and French-speaking residents in Porto never feel they need to master the Portuguese language.

– The city is favored by buyers and visitors from Brazil who experience absolutely no language

barrier and feel at home in Porto.

– There are increasingly more buyers from Asia and Israel, who find Porto a cheaper and more reasonable alternative to Lisbon. 

– Buyers from countries of ex-Soviet Central Asia and Eastern Europe are interested in affordable luxury property in Porto as gateways to advantages of the Golden Visa Portugal.

– Americans make up about a quarter of sales in volume, they prefer three- or four-bedroom condos to the value of 1 million to 1.5 million euro ($1.1 million to $1.6 million). 

Residence by Investment in Portugal: The New York Times’ Tips for Buyers of Housing in Porto

– International buyers can feel quite at ease in Portugal, as there are very few legal restrictions for residence through property investment deals. 

– Buyers can rely on experienced local notaries who offer specialized services simplifying

transactions. Their fees are between 1,000 to 2,500 euros ($1,090 and $2,720), depending on the scope of the notary or attorney services required and the value of the transaction. The value-added tax on notary fees is 23 percent. 

 – Buyers and sellers can act through their agents, but both parties must be present in person on the day of the transaction involving a notary. 

– The real estate agent’s commission (usually 6 percent of the transaction price) is often paid by the seller.

– Buyers do not have to pay the transfer tax for properties purchased as a primary residence at the value of less than 92,407 euros ($100,000). 

– Buyers have to pay the transfer tax for properties purchased as a primary residence at the value of over 92,407 euros ($100,000). This is a progressive tax of up to 7.5 percent. 

– Taxes for properties bought as a second residence are slightly higher. 

Residence by Investment in Portugal: Some Optimistic Concluding Remarks

Portugal, as can be seen from numerous international publications, is gaining its prominence in the Golden Visas and citizenship by investment market, attracting players from all over the world. This trend has proved its benefits for the country’s dynamic development and is much appreciated by local authorities. The beginning of 2020 saw a historic maximum of interest to residence permits by investment in Portugal.

When the pandemic struck, however, the situation worsened considerably. The pandemic has brought about a decline in the issuance of visas. There were some cautious opinions in

early April about the Portuguese government’s plans to put the Golden Visa program on hold for a long period since April because of the virus outbreak and the quarantine.

However, according to The New York Times report, the Stranger and Frontier Service (SEF) have to go back on these plans. Even though the news of the suspension has been reported earlier this year in the post Forbes magazine: Invest in Portuguese residence after the pandemic ends’ 

It is quite clear that Portugal is NOT going to suspend the issuance of its residence permits to those who invest into a property in Porto. 

Authorities in Porto recognize now that to relaunch and put forward the Golden Visas program is a winning strategy in the interest of sellers, the local community, the nation, and foreign buyers. 

The faster real estate sector recovery after the quarantine is, and the more open the Golden Visa Portugal residence by investment program is in Porto, the more sustainable vital support they can grant to the national economy.

However, our encouraging conclusions drawn from The New Your Times article should not be taken with a grain of salt or as an excuse to postpone the application for the residence permit in Portugal when buying a property in Porto. 

One should grasp the opportunities in the current downturn in the tourism and travel industry following the coronavirus shutdown measures in the world and Portugal. The real estate prices in Portugal are very likely to become very attractive soon.

We also recommend our post Forbes magazine: Invest in Portuguese residence after the pandemic ends – a quite encouraging vision of Portugal as one of the best destinations where you can invest after the COVID 19 pandemic is defeated. 

For more options and information about the advantages of Portuguese residency through investment, read Purchase a luxury apartment in Portugal

Would you like to get The Golden Visa Portugal on the most favorable conditions? 

To find the best offer and negotiate the most favorable terms for your property acquisition and residence permit application, you have two options. You can do it yourself and then contact estate agents. Or, you can hire our expert with a deep knowledge of the market and insights in the field of investment.

Our experts are ready to help you buy property in Portugal at a discount and be at your service throughout the process.

We engage most experienced and widely recognized lawyers and real estate agents in Portugal to help individual investors and families find the best real estate proposals to invest in.

You are welcome to place an order, and our experts will be ready to do the following:

– give initial personalized investment advice;

– provide tax information and support;

– open a bank account for your international transactions;

– register real estate transactions;

– assist in obtaining a residence permit.

Please contact our consultants if you are interested in any of the above personalized services. You can send your requests to [email protected].

How to get a residence permit in Portugal when buying a property?

Participation in the Golden Visa Portugal program allows citizens of countries outside the European Union to obtain a residence permit in Portugal through the acquisition of new real estate in a major city like Porto. There are different investment options in this program, including a standard minimum level of 500,000 EUR, and some discountedoptions.

Discounted options are offered on different terms. For example, in case of acquisition of some property built 30 years ago which requires restoration/ refurbishment, the minimum price is 350,000 EUR. If you buy an asset in a sparsely populated or not-so-well-developed area of the country, the entry-level can be reduced by yet another 20%.

You can find out more details from our information support at [email protected], or read about Residency in Portugal via purchasing a luxury apartment

How much is the Golden Visa Portugal in case of property acquisition in Porto? 

Porto features the same standard options:

the Golden Visa Portugal 500k,

the Golden Visa Portugal 400k,

the Golden Visa Portugal 350k,

the Golden Visa 280k.

Besides the property value, the buyer needs to cover notary fees, taxes (when levied), and charges for the issuance of residence permit.