The Portuguese government has removed real estate investments from its “golden visa” program, which offers residency rights to wealthy foreigners, after years of criticism that it was driving up housing prices.
The golden visa scheme, launched in 2012, has brought in 7.3 billion euros ($8 billion) of foreign funds, with about 90% going into property purchases. This influx of money has been blamed for worsening Portugal’s housing crisis, one of the worst in western Europe.
In response, Portugal has now tightened the rules to exclude real estate investments. Wealthy foreigners can still secure residency rights by investing in investment funds, donating to cultural or research projects, and some other options.
Lawyers and funds expect a boom of new money coming into funds as the main route to Portuguese residency under the scheme going forward.
“Real estate has always taken the focus away from the other options,” said lawyer Vanessa Lima. “The main type of investment will (from now on) be in funds – there is no doubt.”
The changes come after years of pressure on Portugal to end the golden visa program entirely, which some European officials have criticized as a security risk.