Advice and Opinion

Retirees fancy investing in property in Europe

Retirement can be a wonderful stage of one’s life. After years of hard work and little time for the ‘me things’, it provides the opportunity to take up the sort of activities you’ve wanted to do for years: get involved in volunteering for a cause that’s close to your heart, travel as much as you like, and spend quality time with friends and family.

If you fancy immersing yourself in other cultures, then spending a few months a year in another country can be a particularly fulfilling way to enjoy retirement years. Keen travellers may favour finding themselves a good spot in Europe, so that travel on the continent or to the East is more accessible. And, with their temperate Mediterranean climates, countries like Portugal and Malta are particularly attractive, offering good weather for many more months than European countries further to the north.

They’re also states in which the prospects for the property market look a lot better than the locations that a number of South Africans got their fingers burned on in thepast, like Spain and Greece, where the severe economic woes of the past years continue.

“While property markets in many countries of the world, in particular those in Europe, are stagnating, Portugal is on the up,” comments the Senior Manager of Henley Partners South Africa, Sandra Woest. “In the ever-popular Algarve region, for instance, property prices rose by about 5% on average in 2015, and the expectation is that this trend will continue into 2016.”

It’s a similar picture for Malta – the average increase in property prices last year was higher than in Portugal, at 8%. This all means that it’s a good time to buy a property in one of these EU states.

Clearly, property values are beginning to strengthen after the disastrous years following the 2008 slump. But they are not yet at the sort of level to be thought of as expensive. So it makes good sense to look into buying a home in either of these countries with a view to spending many months of your retirement there.

Aside from being a solid investment, owning a home in one of these countries could give you residence rights in the EU, an attractive option since you would be able to travel to any of the 28 countries in the EU without having to acquire a visa.

Both countries offer attractive citizenship and residence programmes for foreigners. Portugal’s Golden Residence Permit is available to anyone who can invest at least half a million Euros in a property, while the Malta Global Residence Program also stipulates certain amounts for property purchases or rentals. Portugal’s immigration authorities recently released figures regarding interest in the Golden Residence Permit over the past four years; South Africans have a marked interest in this option, and follow only three other nationalities on the list of successful applicants. And both Portugal and Malta have been rated at the top in their categories in the just-released Henley & Partners Global Residence and Citizenship Programs 2016 report, with Portugal’s Golden Residence Permit Program emerging as the leading residence-
by-investment program and Malta’s Individual Investor Programme coming first for citizenship-by- investment.

According to Woest, “There are a number of factors to look at before making a decision of this sort. For instance, people of retirement age should be particularly cognisant of the need to have valid health insurance.

So, consider the warmth on offer in these countries during the cooler periods in South Africa with lazy days on the beaches of Gozo in Malta or the fresh food markets of Portugal. You can also benefit from the proximity of countries in the EU that are well worth a visit, and just a short train or ferry ride away. Not a bad option for retirement, is it?