Over the last decade, Portugal has become one of the most popular destinations for high-net-worth individuals to visit, invest and live.
There are many factors that explain Portugal's rise, including it's natural beauty, the favourable Real Estate market and the creation of the Golden Visa program.
Portugal is one of the most attractive countries in the European Union for foreign investors due to its beautiful landscapes and the abundance of rural spaces still to be developed.
Each of the Country's regions is rich in history, culture and gastronomy. It's relatively small size means that one can quickly travel from the breath-taking Douro Valley to the blissful beaches in the Algarve.
In addition to the excellent beaches and attractive climate, Portugal is regarded as one of the safest places to live. This strengthens the country's position as not only a place with good quality of life, but also as an increasingly popular tourist destination.
For instance, Portugal was awarded 'Best European Destination' at the 2019 World Travel Awards.
During the last decade, Tourism has been growing at an average rate of 7.2% and pre-pandemic statistics show that the annual number of tourists in Portugal stood at around 25 million.
REAL ESTATE MARKET
One of the main drivers for this growth in recent years has been the simplified and low-cost Golden Visa program which starts at €350,000. This also allows investors access to the other EU 26 countries.
Real Estate prices have been moving in a strong and sustained upward trajectory over the last few years. This is due to the rise in demand and strong foreign direct investment seen since the early 2000s.
Percentage change in the price per square meter in Lisbon (2016-2021)
Percentage change in the price per square meter in Porto (2016-2021)
Typical net yield for long-term rentals
Typical net yield for short-term rentals
Portugal has since 2009 counted with a range a range of tax benefits for both EU and non-EU citizens, which made attaining residency quick, easy, and financially lucrative. The aim was to encourage direct foreign investment and help get the economy back on its feet after the Global Financial Crisis which has proved very successful strategy.
New residents are usually entitled to the Non-Habitual Residence regime (NHR). This means that for the first ten years they are in Portugal they benefit from a favourable taxation scheme. For example, British pensions, can be paid gross, i.e. without deducting UK tax in the UK and with no tax due in Portugal over the ten years of the NHR scheme.
Portugal has also been among the economies to best recover from the Covid-19 pandemic and is seen as one of the EU economies that is currently most protected against the ongoing energy. This is largely due to the fact that the country is able to meet most of its energy internal demand, which is produced mainly through renewables. [Source]