More than 10,000 Golden Visas have now been issued by the Portuguese government, making the GVP the most successful residency-by-investment programme in Europe.
Since the programme opened in 2012, Portugal’s Golden Visa (GVP) has been a popular choice for South Africans seeking offshore investment and European residency, said Andrew Rissik, a managing director at Sable International.
He said that South Africa is the fourth most popular country that Golden Visa applicants hail from, with over 416 Golden Visas issued to South African investors to date – excluding joining family.
What is Portugal’s Golden visa?
This is a visa that is issued to non-EU nationals who have made a specific investment into the country, said Rissik. Investors can gain Portuguese citizenship through residency-by-absence and gain EU citizenship after holding temporary residency status for just five years.
Why the Golden Visa is so popular with South Africans?
Gaining dual residency (or nationality) for applicants and their families is the biggest drawcard, Rissik pointed out. Investors can include partners, dependent parents, and dependent children. This includes children up to the age of 18 or children over the age of 18 who are unmarried, financially dependent, and enrolled in full-time education for the duration of the process.
Residency can be maintained with only 35 days spent in Portugal over five years. After five years, visa holders can apply for permanent residency or citizenship. This provides access to the EU as everyone with Portuguese citizenship can live and work in Europe, he said.
“The GVP has proven to be a good option for South African families who don’t necessarily wish to leave South Africa now, but may want to have the option in the future. Unlike with many other European citizenship-by-investment options, there is no government contribution required. 100% of the funds go into your investment and can generate a return.”
Sable noted that Golden Visa investment options start at €280,000 (R4.9 million), which also makes Portugal more affordable than most of Europe. The most popular options are a €500,000 property investment or investment into a Private Equity Fund (PEF).
Property provides a foreign-currency asset that can earn you rental income, while a PEF is a hands-off investment that can earn you a decent profit.
“The lifestyle is another factor – Portugal offers a low-cost, high standard of living in a stunning Mediterranean climate and has been voted one of the safest countries in the world,” said Rissik.
Make an informed decision
As the GVP investment rules tighten up, it is becoming increasingly complex to find and invest in a suitable property to obtain the visa, Rissik said.
“With so many people showing interest in the programme, more and more companies are targeting South Africans with Golden Visa investment opportunities. Potential applicants need to scrutinise the opportunities very carefully to ensure their GVP investment meets all of the requirements.”
One of the most popular GVP investment options is in property in a qualifying low-density area. “However, there are very specific zones and types of property that qualify you for the Golden Visa and the properties have to comply with the programme,” Rissik said.
“It’s very important to be particular about the properties you select in low-density areas. A developer has a vested interest in selling you their development, but what about your exit strategy? Some low-density areas are up and coming and make for an excellent investment, while others may be less appealing when you eventually wish to sell.”
Sable noted that another common issue encountered is that, while going directly through a developer, estate agent or lawyer may seem cheaper, they often don’t give clients a proper breakdown in costs. An independent agency with nothing to hide should be completely transparent about fees and what you can expect.
“The GVP is complex and unfortunately not all agents in Portugal are well-versed in the ins and outs of it and mistakes are all too common. It’s best for potential applicants to use an agency based in SA and in Portugal that can accompany you through the process of finding a qualifying investment property,” Rissik said.