The Golden Visa program ("ARI") was established in Portugal in October 2012 and aims to grant residence permits in the country to foreign investors.

It is estimated that since the beginning of the program, more than 9,000 investors and 16000 family members have opted to apply for this program, making a total foreign investment in Portugal of around 5.6 billion euros.

The values involved and the results of this program have been very important for the development of the Portuguese economy, commerce and tourism and present themselves as valid alternatives to traditional development and investment attraction techniques.

The real estate investment types are those that have received the highest volume of investor´s interest and are consequently those that represent the largest slice of this investment cake and of the Golden Visa program, and perhaps because of this they are the ones where the changes to the Golden Visa program that come into force on 1st January 2022 will be noticed, but there will also be changes to the capital investment rules.

The changes carried out by the Portuguese Government have been suspended due to the COVID-19 pandemic during 2020 and the market has one year to adapt to the new rules.

These changes were motivated by the inflation of the real estate market in the large urban centers of Lisbon and Porto and by the need for greater regulation of investment activity in the country.

The Decree-Law no. 14/2021, of 12 February changes the legal regime for the entry, stay, exit and expulsion of foreigners from national territory.

Regarding Real Estate investment, this regime limits the granting of Investment Residence Permits (ARI) in Lisbon, Porto, Algarve and coastal towns like Setúbal and the Silver Coast.

Note that this rule affects the acquisition of properties for residential purposes, but not those intended for commerce, tourism or services.

This way only real estate investments in properties for habitation purposes worth that are located in the Autonomous Regions of the Azores and Madeira or in the interior territories will be eligible to acquire the Portuguese Golden Visa.

Regarding the capital investment, this regime changes the minimum investment values: capital transfers will have to be made for a minimum amount of 1.5 million euros instead of the 1 million as now required and investments in funds will have a minimum amount of investment of 500 thousand euros instead of the current 350 thousand.

However, it should be noted that these changes are only effective for those who apply for the program from 1st January 2022, so that all other processes already submitted can take place without any affectation in terms of investment and ARI renewals. In this sense, it is still possible to benefit for the actual minimum amounts of investment if the processes will be submitted until December 2021.

That said, it is important to identify the opportunities that will result from these changes:

In Portugal there are several areas of low population density with enormous potential for growth and exploitation, such as the Douro Region, known for its wine production and tremendous landscapes, and the entire Gerês area characterized by the stunning green of nature, for its waterfalls, trails and unique cuisine. Here for only 400k or 280K, the applicants can invest in low-density areas and become eligible for the Portuguese  Golden Visa Program.

Portugal continues to be one of the most attractive destinations in Europe and the world for tourism, investment or even a change in lifestyle and this attraction will always be much more embracing than just the big urban centers.

Among the great advantages of the golden visa program are the possibility to travel within the Schengen area without a residence visa, a possibility to apply for the permanent residence or Portuguese citizenship after five years of legal residence, the possibility of working in Portugal and benefit from family reunion well as from our health care, social protection, and educational system.

This regime of changes to the rules of the Golden Visa program does not limit foreign investment in Portugal, but rather opens doors to the discovery of another Portugal and a whole world of opportunities.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.