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Is this the right time to be selling property in Portugal?
Yes, it probably is, as property prices in Portugal are really attractive right now. Indeed, selling overseas property in Portugal or across Europe right now makes a lot of sense when you have all the trade wars and so on going on in the world.
But why are property prices rising in Portugal? Two words: Golden Visa. The Golden Visa scheme is an incentive introduced by the Portuguese government to encourage overseas investment in Portuguese properties.
Basically, the golden visa offers Portuguese residency to investors from outside the EU and allows them free movement across the Schengen area that comprises of 26 EU member states as long as they make a minimum investment of €500,000 in properties in Portugal.
It’s hardly a surprise that this scheme has been so successful. We have a number of wealthy foreign investors from China, Brazil and South Africa buying property in Portugal just for the Golden Visa.
In fact, according to a report from Knight Frank, titled Knight Frank Portugal Insight 2018, close to 4,000 foreign investors were issued Golden Visa since the launch of the scheme in 2012: 3890 from China, 561 from Brazil and 254 from South Africa.
So far, Chinese nationals have invested €2.06 billion in properties in Portugal. That is stunning!
In 2017, however, the Chinese investment has come down by 37% - that could have been due to the new restrictions imposed by the Chinese government against the outflow of money from the country.
Brazilians are the other major buyers of Portuguese property. Brazil and Portugal share many similarities – they speak the same language, after all. A vast section of Brazil’s population is of Portuguese origin.
That’s why it’s not a surprise that many Brazilians will want to move to Portugal or have a second home there. In 2017 alone, wealthy Brazilians invested €179 million in properties in Portugal.
South Africans are fast emerging as major players in the Portuguese property market. There are many wealthy people in South Africa and many of them are trying to find a way out of their country, because of the worsening economic and political situation there.
Portugal offers an excellent alternative – Portugal is not only a rich, first world nation, but also one of the most stable countries in the world, politically. In 2017, South Africans invested €140 million in the Portuguese property market. We expect that number to be 5X to 8X times this year, as the situation in South Africa has become really desperate in the last few months.
But the traditional buyers of Portuguese property continue to remain the Brits and the Irish. Buyers from the UK and Ireland have always formed a bulk of the overseas investors in Portugal’s property market.
Also involved are wealthy individuals from Norway, Sweden and other Scandinavian countries, who are buying many properties in Portugal. The French, Germans, Russians and other Europeans are interested too. Indeed, this is as good a time as any to be selling property in Portugal.