Changes to Portugal’s Golden Visa: Cancellation Of The Program

***Portugal has decided to end its golden visa program for foreign property buyers to address the country’s lack of affordable housing.

When I moved to Lisbon, it was a completely different city than it is today. Buildings were in shambles, tourism was manageable, and prices were low. This has all changed due to Portugal’s popularity. Today, if you go downtown it is packed with tourists. Neighborhoods such as Madragoa which used to be filled with Portuguese are now hubs for expats (no joke, Santos is pretty much all Americans now; Graca, Amoreiras and Campo de Ourique is French, you get the idea). On top of this, it is so weird to walk the city sometimes because many large residential buildings don’t even have lights on. These are apartments that were bought under the Golden Visa regime so that people could move their money out of their native country and get a visa that would get them a visa for Europe (INE – the body in charge of statistics for Portugal says that there are over 700 million empty homes in Portugal). Let us take a look at what is going on.

The Ultimate Change to The Golden Visa, Its Cancellation.

This program, which allowed non-European Union nationals to acquire residency permits in return for property investment, has been increasingly popular with Chinese and American investors. As a result, the government has stated that it will no longer issue new golden visas. Still, foreign buyers can renew their existing visas only if their properties are used as their primary homes or are placed on the long-term rental market.

The Golden Visa program, which raised €6.8 billion ($7.3 billion) since its inception a decade ago, has been criticized for driving up real estate prices and making housing unaffordable for many locals. The program was introduced to help get the country’s public finances in order after the 2011 bailout that came from the EU and International Monetary Fund. However, the Portuguese government has deemed the program “no longer justified”. It has begun restricting permits and excluding property purchases in cities like Lisbon, where home prices have more than doubled since 2015.

As you can see from the rest of the post below this update, changes to the Golden Visa program have been adopted across Europe and in countries around the world. The costs of the program to society, including but not limited to a ridiculously steep rise in real estate pricing, homeowners who keep their homes empty, and allegations of corruption, outweigh the benefits, and politicians have finally dropped them.

The Portuguese government has announced a 900-million-euro package of measures to tackle the housing crisis in the country. The package includes a ban on new licenses for short-term holiday rentals (AirBnB type rentals), and tax incentives for landlords who convert tourism properties into houses for locals to rent. Additionally, a mechanism will be introduced to regulate rent increases.

The end of the Golden Visa program marks a significant step towards addressing Portugal’s housing crisis, but it may also have consequences for foreign investment in the country. The government’s new measures aim to make housing more affordable and accessible to the local population, a much-needed relief for many struggling with skyrocketing rents and house prices. However, with these changes, it remains to be seen how the real estate market will adjust and its impact on foreign investment in Portugal.