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Portugal has recently shut down its residence-by-investment programme, which was also referred to as the Golden Visa scheme. It’s claimed that the decision to end it was driven by the country’s ongoing housing crisis, which has driven property prices up while locals have not seen their wages increase at the same rate.
One report highlights that rental prices increased by 37% in 2022, making it impossible for the Portuguese people to get into the housing market. With such a popular scheme closing, you may be worried about the alternatives and if they’re as good as the Portuguese offering.
Here we unpack some similar options.
Other options and future closures?
The closure of the Portuguese Golden Visa programme still needs to be implemented after it is defined and debated in Parliament on 16 March. [16 March has come and gone. Is there an update here?] There may still be other options to consider if it is shut down. ‘Like many other countries, Portugal has a wide range of residency programmes including the D7 passive income or self-sufficiency visa programme and the D3 or Highly Qualified Activity (HQA) Visa. Specifically created for highly qualified professionals and entrepreneurs, the HQA Visa is currently the quickest, most convenient and cost-effective investment-based path to establishing residence in Portugal. It provides investors with benefits like those of the Golden Visa at a reduced total investment requirement of €185,000 (R3,627,762),’ says Ceri Pratley, head of residency and citizenship-by-investment services at Sovereign Trust SA.
Whatever the Portuguese government decides, Portugal may not be the only country to shut down its residence-by-investment programme. ‘Since mid-2022 the European Commission has been urging the European Union governments to phase out and end their various Golden Visa programmes. Ireland recently shut their programme down and we believe that several other European Union programmes will either be altered or ended,’ says Stuart Ferguson, director at 12 Star Capital.
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Outside of the EU
Outside the EU there are several programmes to consider. Mauritius, for instance, is currently one of the least expensive options for South Africans seeking to obtain a permanent residency by investment. According to a leading Mauritian real estate agency, Park Lane Properties, it’s possible for non-citizens of Mauritius to obtain an immediate permanent residence by investing a minimum of $375,000 in certain types of property – the well-known IRS, RES, and PDS developments such as Smart Cities and Ground+2 apartment developments.
‘This amount is equivalent to the lowest property investment requirements among those European Union countries that do still offer residence-by-investment, and substantially less than the most expensive Golden Visas. However, in Mauritius there are now also options to gain ordinary residence as an investor, self-employed person, professional or retired non-citizen.
‘What’s more, Mauritius is only a four-hour flight from South Africa and offers a great climate and lifestyle as well as a thriving, growing economy,’ says Philippe de Beer, CEO of Park Lane Properties.
Prately points out that there are plenty of other countries that also have similar citizenship-by-investment programmes, such as many Caribbean nations, the USA with its EB-5 visa, Grenade [Should this be Grenada? It’s a Caribbean nation, so this should probably read “…many Caribbean nations, like Grenada, and the USA …”] and others. It’s important to drill down into the terms and conditions if you’re considering such alternatives. With America’s EB-5, for instance, eligible immigrants must invest a minimum of $1,050,000 (R19,537,319) in a local business and employ 10 Americans. The investment can be reduced to $800,000 (R14,885,576) though if the investment is made in a targeted employment area (TEA). These are defined as areas where there is a high level of unemployment or if the business is in a rural area.
The options for residency and citizenship are still many and varied but it’s important to consider all the options and the facts before committing. Prately adds: ‘Whatever becomes of the Portuguese Golden Visa residency permit, it will not signify the end of alternative residency and citizenship options for South Africans who wish to emigrate, establish a Plan B and/or provide greater options for themselves, their loved ones, and future generations.’
