Prices of real estate in Portugal have dropped greatly dropped by double digits in Portugal’s largest cities of Lisbon and Porto.
Nevertheless, Portugal’s real estate sector hasn’t actually experienced the boom many European countries have.
This has caused banks to now try to unload properties by rolling out discounts over 12-13%, available for foreign investors to snatch up as many as 10,000 homes this year. BCP (Banco Millenium) is leading the way with heavy discounts. There are thousands of properties available on sale in the warm tourist spots like the Algarve and the rustic center Portugal.
Portugal’s Golden Residence Permit gives instant residence to anyone investing €500,000 in one or more properties. The beauty of this is you can actually spread the investment out over multiple properties so you can use some of the value for your own overseas residence, and the rest for investment. These have really offered an opportunity for investors seeking for second residence in Europe.
The Golden Residence Visa can equally be acquired by investing one million Euros into just about any company in Portugal, or creating ten new jobs in a business, similar to the US EB-5 program. However real estate is our focus here.
Portugal, just like the USA, has started to experience huge amounts of Asian real estate investors who are more than willing to put in 500k Euros for the right to live and travel anywhere in the Schengen Zone. Investors become permanent residents in Portugal after living in Portugal for over 5 years and after 6 years (with a little Portuguese savvy), they will be able nationalize in Portugal.
Portugal is leading the European Union export train with exports of over 10% in one month lately. Locals seem to get that the party of endless spending on imported goods and the luxurious lifestyle that comes with is over. Rather than threaten revolution like the Spanish, they’re actually taking up the initiative to focus on their business strength such as agriculture and even clothing and shoes that have are always in competition with Chinese products.
For Wine Lovers, by spending a day or two inside the Douro Valley, you’ll realize that northern Portugal is the center of all types of wines you’ll ever find anywhere else.
Portugal is an ideal place for those looking for a European property investment with a warm weather climate. The nonsense going on there pales in comparison with other southern European PIIGS states. And you’re likely to find a good deal depending on the type of property you’re looking to get.
For those who prefer a more rural setting, for barely $100,000, you’ll find a few five-bedroom, nearly-2,000 square foot houses in central Portugal villages. However, apartments Lisbon will run $200,000 and up for more cramped quarters in the city center, or 1,000-ish square feet as you head a few stops on the metro line.
You can equally join former investors like The Beatles and own a home in the party-friendly beach areas of the Algarve down south. Values there have made properties quite attractive to rich Russians and Chinese looking to establish a second residence in Europe.
You’ll need to hold your investment through the five-year investment window if you’re investing for a residence permit. It is a good practice to avoid using your offshore corporation to buy real estate in Portugal as you’ll be exposed to hefty transaction taxes.
Fortunately, foreign real estate owned in your name is not a reportable financial asset in the United States. This makes owning an overseas property a great way of diversifying your assets in a place you would love to settle in.
Portugal is a nice place to invest in and though would always recommend keeping your offshore bank account in a separate country from your second residence. If you like the Mediterranean climate, the local wine, the port wines in Porto, beautiful cliffs, and fairy tale castles like those in Sintra and gorgeous landscapes, then Portugal is the place you should consider.
Portugal’s negotiable real estate prices and openness to low-ball bidder’s renders its beautiful sites affordable to everybody who ever dreamed of settling in Portugal.