Key Takeaways
- Portugal’s Prime Minister contemplates ending the 10-year-old Golden Visa due to criticism over foreign investments inflating housing prices.
- Portugal reassesses the Residency by Investment Program (Golden Visa) amid concerns about housing cost inflation and the impact of foreign investments.
- Recent measures entail increased capital investment requirements and restricted city options for real estate purchases, aiming to reduce Golden Visa applications.
- Portugal plans to replace the fast-track residence visa with a digital nomad visa, permitting remote workers to stay in the country for one year under specific eligibility guidelines.
The Potential End of Golden Visa
Lisbon, Portugal–The Prime Minister of Portugal, António Costa, recently made a public statement about the possibility of the European nation’s decision to scrap the popular Golden Visa program.
According to a report, the 10-year-old scheme had come under much criticism since foreign investments significantly raised housing and rent prices across the country.
Portugal would be the fourth nation after Malta, Cyprus, and Bulgaria to remove the Golden Visa program after the European Commission made a statement for its abolishment.
“There are programs that we are currently re-evaluating, and one of them is the gold visa which, probably, has already fulfilled the function it had to fulfil and which, at this moment, it is no longer justified to maintain,” said Costa in the report.
The Residency by Investment Program (RIP), or the Golden Visa program, is a residence visa issued to non-European Union (EU) nationals who make large real estate purchases and investments or have created employment opportunities in Portugal.
Stricter Eligibility and Program Impact
Over the last few months, Portuguese authorities have been enforcing stricter requirements (increasing minimum capital investment from €350,000 to €500,000, fund transfer from €1 million to €1.5 million, and removing many cities from the list of purchase options) for eligibility of the residence visa to reduce the number of applicants.
Per data from the Portuguese Immigration and Border Service (SEF), investments raised through Portugal’s Golden Visa program were more than €78 million in July this year, more than double the €36 million recorded during the same period last year.
Proposed Alternative Visa
Authorities hope to replace the fast-track residence visa with the newly released digital nomad visa. Portugal’s “residence visa for the exercise of professional activity provided remotely outside the national territory” allows remote workers to reside in the country for one year.
To be eligible, one must have a minimum monthly income of €2,800 ($2725), come from outside the EU or EEA, and be self-employed or employed by a company outside Portugal.
What We Think
Portugal’s contemplation of ending the Golden Visa program reflects concerns about its economic impact on housing prices. The stricter requirements aim to control the program’s influence, as seen in the significant increase in investments recorded.
The shift towards a digital nomad visa signals a potential avenue for remote workers seeking residency. While ending the Golden Visa may address housing concerns, introducing alternative visa programs like the digital nomad visa aligns with evolving work patterns, attracting a new demographic to Portugal’s shores.
