Portugal Golden Visa Program Ending

Portugal ends Golden Visa program

Portugal has announced that it is ending its Golden Visa program for foreign property buyers as it seeks to address the lack of affordable housing in the country. The program, which was introduced a decade ago for non-European Union nationals as part of an effort to fix the country’s public finances following a 2011 bailout from the EU and International Monetary Fund, raised €6.8 billion ($7.3 billion), with 90% of that money going into real estate, according to the Portuguese Immigration and Borders Service.

Foreign real estate buyers who wish to renew their existing golden visas will only be eligible if their properties are used as their own home, or if these units are placed in the long-term rental market, according to Prime Minister Antonio Costa. This move is expected to fight real estate speculation and make housing more affordable for many segments of the population.

The golden visa program in Portugal has been popular among Chinese nationals, who accounted for almost half of the 11,628 residency permits granted under the program and are increasingly popular with U.S. investors. Golden visa candidates have so far been required to carry out a property investment of at least €350,000, create at least 10 jobs in Portugal, or transfer €1.5 million.

Portuguese politicians have criticized the program for driving up real estate prices and making housing unaffordable for many population segments. EU officials have also pointed to potential risks of tax evasion and money laundering by international buyers.

This move by Portugal to end its Golden Visa program follows similar moves by other countries around the world, including Spain and Greece, who have also adopted variations of the program. Such programs tend to last until a critical mass of vocal opponents conclude that the costs, including soaring housing prices, absentee homeowners, and allegations of corruption, outweigh the benefits, and politicians drop them.

According to real estate consultant Savills in Portugal, the Golden Visa program helped attract foreign investors to the country when it needed the money a decade ago, but today only accounts for 3% of property deals at most. Paulo Silva, head of Savills in Portugal, said that “It’s a mistake to blame the golden visas on rising real estate prices as this is mostly due to an imbalance between supply and demand. The end result is that investors will just take their money and invest in another country where they can get a golden visa.”

Overall, this move by Portugal to end its Golden Visa program shows the country’s commitment to addressing the affordable housing shortage and ensuring that its citizens can access affordable housing. It remains to be seen how this move will impact the real estate market in the short and long term, but it is a clear signal that Portugal is taking the issue seriously.

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