Prior to the changes, there was a sort of "Golden Visa rush" among aspiring applicants, who were scrambling to get their applications successfully submitted right until the last minute. On top of that, there was the added uncertainty of the global pandemic, which led to worries about international travel, as well as delays and confusion with SEF (Portuguese Border and Immigration Service), making some aspects of the program quite a logistical pain.
For consultants, lawyers, and also, for us at Nomad Gate, it has been somewhat of a different story. While we've been trying to help people get all the info they need to get their applications completed before the deadline, we've also spent the past year trying to figure out exactly what the new rules will look like, and what prospects they will bring.
After a change of the rules to the Golden Visa in Portugal came into effect at the start of the year, the whole industry has an idea of what 2022 and beyond will look like. However, we still sense there is some confusion, particularly when it comes to real estate investments and the areas that qualify under the new rules.
The new rules: What's the issue?
In case you are unfamiliar with the new rules, residential real estate investments only qualify in areas that are considered "interior"—which is a classification determined by a published list of municipalities and parishes. To these aren’t even all inland, there are in fact a few coastal municipalities on the list. In addition, both the Azores and Madeira follow the same rules as the “interior” areas, even though they are not classified as such.
Then there’s the added variables of "low-density" and "high-density", which have an impact on the minimum investment amounts (i.e. low-density areas give you a 20% discount). These are not determined at the parish/municipality level like the "interior" classification, but instead at something called the NUTS 3 level, a kind of division of Portugal for statistical purposes. Whether something is considered low-density or not depends also on the GDP and population density, two factors that can change over time. Confused yet?
If you are a prospective Golden Visa applicant, it would be no surprise that these rules are difficult to wrap your head around. Actually, in doing our own research, we noticed several maps surfacing on the internet that were factually incorrect, and many top advisors have been consistently getting things wrong.
Finally, there are other variables such as whether or not the property is a rehabilitation project or not, and also if the property is for commercial use—in the latter case, the rules haven't even changed, which also got us wondering about where Airbnb's fall under this, and all other types of questions.
We realized that the new rules presented more questions than answers, and could potentially put people off the idea of applying for the Portuguese Golden Visa.
First of all, we set out on a mission to provide the most accurate real estate map on the internet regarding the Portuguese Golden Visa. However, it was quite a laborious task, and no surprise that many other sites made errors in building their own maps, as Portugal is comprised of 308 municipalities and 2 autonomous regions, within those there are over 4000 parishes, or freguesias.
In order to build the map, we had to determine which parts of Portugal were considered low density or high density, as well as interior and non-interior. Not to mention that this map will need updating regularly as the GDP and population density of various regions change.
In the end, we succeeded and are proud to present you with a detailed map that indicates where exactly you can invest in real estate, whether it is residential or commercial, low or high density.
While the map gives a nice overview of which regions are attractive in the upcoming years, it's still not the most user-friendly way to find out what the minimum investment will be for an exact address or parish. After all, with an average population of around 2,500 people per parish, I doubt most aspiring applicants will be able to locate random parishes on our map without an extremely detailed Portuguese geography lesson.
That's why, considering the Nomad Gate team are a bit geeky with data, we decided to build our own search tool, where you can enter an address (whether it is a street, town, or even parish) and it will tell you all you need to know about that area for the purposes of the Golden Visa, including:
● Density (high vs. low)
● Whether residential Golden Visa investments are allowed or not
● The minimum investment amounts for both rehabilitation projects and regular real estate
● Info about the municipality, such as the official website.
● Links to urban rehabilitation areas in the municipality
● Available commercial real estate investment options for the Golden Visa in the area (if any)
Well, putting the real estate options to the side one moment, I expect that fund investments will remain popular for investors who care about the ease of managing their investment remotely from 2022 and beyond. Of course, as long as they don't mind the new €500,000 minimum investment requirement.
For other investors valuing ease of management, yet wanting a lower entry price and the feeling of owning something more tangible, investments in commercial real estate (such as hotel developments starting at just €280,000) will likely increase in popularity.
For all the rest who are looking to focus on investing in a residential property, and perhaps intending to live in it as well, there are still some pockets of the Algarve that qualify as an interior region, as well as the trending Azores and Madeira islands.
Other possible trending areas could also include the Alentejo region and some parts of Northern Portugal. Again, the best way to find out the options is by using our search tool which will show you in detail what areas qualify, and at what price points.
We hope that since we are more than halfway through 2022 already, that the rules are pretty clear now for both future investors as well as specialists in the investment migration industry. At least, we hope our search tool, map, and detailed guides help fill all the knowledge gaps people may have.
Finally, one huge source of help is the great community support that you can find with Nomad Gate's forum. Many people have shared their personal experiences, questions and thoughts on the program, as well as life in Portugal in general. It's definitely a good place to turn to if something unexpected suddenly happens along the application process. Should you have any questions related to the Portuguese Golden Visa, feel free to post it in our forums and the community will be happy to help.