Europe’s ever-popular golden visa programs…
When we read about financial headwinds, soaring inflation due to rising energy prices and a looming recession on the horizon, it should be noted that not all international markets are in turmoil.
Greece and Portugal have reduced their public deficits by more than half and are less exposed than most European countries to gas supply shocks from Russia. Greece is being boosted by a recovery in foreign investment – and tourism, which Covid had reduced by 20-15% of its gross domestic product. Less than 10% of bank loans are non-performing, compared to 50% during the crisis.
With growth of over 4% and inflation falling rapidly, Greece is experiencing one of the strongest recoveries in the region. Portugal is in a similar place. It is investing EU support funds wisely and reforming one of the continent’s most overly generous pension systems. It is perhaps no coincidence that the best performing stock market in the developed world this year is Lisbon. These countries have also been two of the most successful in Europe in developing their Golden Visa programs, attracting a wave of wealthy new emigrants.
A Golden Visa refers to the immigration program that allows wealthy individuals to obtain residency, or even citizenship, in another country simply by purchasing property or making a relatively large investment or donation. Different countries have different investment options, which range from $250,000 to millions.
If you make the required investment and apply for a Golden Visa, you and your family members will become legal residents of that country. You can live there, go to school and have access to health care, as well as many other resident benefits.
Portugal is now considered a high-end tourist and real estate location, as well as one of the main countries in the EU for research and new technologies. Growing housing and rental prices, booming tourist numbers complemented by a stable political and social environment, a modern education system, a highly skilled and fluent English-speaking workforce, and excellent quality of life.
Portugal occupies the sixth position in the ranking of countries with the highest percentage of female entrepreneurs, ahead of countries such as Spain, Italy or Ireland. Women are navigating their way to the top of the business ladder, and investment migration can help them take their success to the global stage.
Residential properties in the most popular areas such as Lisbon or Porto are no longer eligible for the Golden Visa with the aim of supporting local investment. However, commercial properties are still eligible, leading to increased global demand. Residential and commercial units in the islands of Madeira and the Azores are also eligible for the Golden Visa.
According to JLL Portugal, one of our member firms familiar with Golden Visa investment opportunities, real estate on Madeira Island has seen capital appreciation of over 7% per year, and being a tourist hotspot , it has great return potential on rentals . Portugal also offers the added benefit of a coveted European passport after five years of residence.
Greece recently announced that it will double the minimum investment amount required to purchase a Golden Visa property from €250,000 to €500,000. In this way, an attempt will be made to increase the stock of real estate available for purchase by local buyers. However, the appetite for an extended summer in the South Aegean is far from over for international investors, and Greek investment tourism is heading for a bumper year.
Helped by the country’s strict handling of the pandemic (and well-staffed airports), international tourism revenues are expected to surpass 2019’s record highs, with Britons and Germans spending more there in the first six months. month of 2022 than during the same period. of 2019.
While many visitors flock to hedonistic Mykonos or the shores of pin-up Santorini, neighboring Paros quietly attracts those who prefer to escape the crowds and high prices. They are also building a new smart city, The Ellinikon, on the Athens coast, which is expected to attract 1 million tourists a year.
There are other EU countries offering similar programs including Italy, Cyprus, Latvia and Luxembourg and more than 20 territories around the world, from Hong Kong to Australia. It will be interesting to see if they can balance global investment potential with a strong local economy like Greece and Portugal have, aided in particular by their stunning islands, natural landscapes and wild beaches.
* Chris Dietz is President of Global Operations at Leading Real Estate Companies of the World