Portugal Golden Visa and Its 280,000 Euro Option
The first Golden Visa program was launched in Portugal on October 8, 2012. As Portugal’s real estate market lost its value, Portugal Golden Visa had been introduced to bring new funds. Portugal’s Golden Visa is offered in accordance with the Ministry of Foreign Affairs through AICEP (Department of Consular Affairs and the Portuguese Trade and Investment Agency).
Portugal’s Golden Visa program is now quite a decorated one. According to the report of The Global Residence and Citizenship Programs 2017-2018, Portugal’s Golden Visa Programme is world’s best residence by investment program. It is the third consecutive year for Portugal to be announced to have the top residence by investment program across the planet. The report uses ten indicators, namely: citizenship requirements, compliance, financial requirements, processing time and quality of processing, quality of life, reputation, taxation, time to citizenship, total costs, and visa-free access. From all these indicators, Portugal’s program achieved 79 points out of 100.
Relevant Investment Options of Portugal Golden Visa
The investors may choose to invest in Portuguese property of at least €500,000. They may choose to invest as an individual or as a joint legal entity. If the property is in a “low density area”, minimum requirement gets reduced to €400,000.
Real Estate and Rehabilitation
The investors may choose to invest in Portugal property that is in need of rehabilitation and restoration. In this case, minimum requirement decreases to €350,000. The property either has to be built more than 30 years ago or has to be located in a designated area of urban rehabilitation. If the property is in a “low density area”, minimum requirement gets reduced to €280,000.
Property Renovation Option of Portugal Golden Visa
To be able to use the property renovation option of Portugal Golden Visa, investors must make sure that the building is approved by the Town Hall (Camara Municipal). Therefore, the property that is to be purchased must either be confirmed at the Town Hall by the previous owner, or be examined by an architect who is hired by the investor and reported to the Town Hall afterwards.
The Golden Visa investment in this option involves the property price and the ex-VAT cost of the contracted renovation works. Other expenses such as assistance fees, government fees and taxes do not count towards the investment amount.
280,000 Euro Option of Portugal Golden Visa
Portugal Golden Visa Program has several investment options as mentioned above. Economically most advantageous one of these options is the 280k euros option. However, this is only a short term advantage, because more expensive options in more popular areas tend to yield better returns in the long term process.
280,000 euro option of the Portugal Golden Visa is available only in lower density areas. According to the Golden Visa rules of Portugal, designated lower density areas give 20 per cent off to the investors over the total value. Therefore, if the applicant chooses to invest in a property that is designated for rehabilitation, they get 20 per cent off of the minimum investment requirement which is 350,000 euros. When the 20 per cent discount is applied to this, the result is 280,000 euros.
Lower density areas are designated according to the population of the region. If the area has less than 100 inhabitants per square metres, it is considered a lower density area. Another criterion of this is the gross domestic product per capita which qualifies a region as a lower density area if it is below 75 per cent.
Since more popular areas offer better potential of returns, people usually consider Lisbon or Porto as better investments. Yet, the 280k option is almost half the price and this value is quite attractive for lower strata investors. The main aim of this price reduction is to attract investors to less popular areas in the first place, and these places are by no means undesirable.
The Most Popular Lower Density Areas in Portugal
Many neighbourhoods like Alentejo, Viseu, Évora and Beja are both popular spots among tourists and offer great prices. The most popular of the whole country are listed as this: Faro, Viseu, Santarém, Leiria, Braga, Aveiro, Viana do Castelo, some neighbourhoods of Porto, and Coimbra.
Advantages of the Lower Density Areas
The lower capital required for investment in these areas give more freedom to the investors in their business affairs. Away from the overwhelming crowds, these areas of Portugal are great for new beginnings. Also, a lot of these areas are popular among tourists of different kinds for their versatile nature. The interior cities of Portugal are getting more and more popular among students, and as the youth population increases in these cities, the need and opportunity for catering to them intensifies. New investors can easily take advantage of this need in their business affairs. Finally, people who choose Portugal as their retirement residency might like these places better because of their calmness and lower costs of living.