It seems South Africans are right on trend when it comes to selecting an international investment destination for residential property.
With Portugal being hailed as the ‘California of Europe’ and attracting a host of global buyers, South African purchasers have quickly realized that Portugal has much to offer, particularly as a hard currency investment with solid returns and good long-term capital appreciation prospects.
Chris Immelman, MD of Pam Golding Properties International & Projects Division says the benefit of being able to acquire a Schengen Visa and Portuguese residency is also a huge draw card as it opens up opportunities for freedom of travel abroad. “Most of our South African buyers are looking to create international opportunities for their children and enabling them to study, live and work in a European Country has undoubted appeal”.
“Over the past 18 months since we began marketing property in Portugal we have concluded close to 100 transactions to the total value of some €70 million. These buyers are mostly South Africans, including a few expatriates living in Dubai, as well as a few Kenyans”.
“The Golden Visa Programme and EU residency is undoubtedly still the overwhelming reason for South Africans purchasing property in Portugal, with Lisbon and Cascais by far the most popular. Lisbon because of the large scale regeneration taking place, with prices still well below other European capital cities, and Cascais on the Portuguese Riviera because it is only a 20 minute commute from Lisbon but happens to be one of the country’s most beautiful seaside towns. Proximity wise to the country’s capital city it’s comparable to Camps Bay in Cape Town.”
The Golden Visa scheme offers Portuguese residency in return for a minimum €500 000 real estate purchase, with permanent residency achievable in year six and citizenship in year seven.
While the first €500 000 has to be in cash, mortgages of up to about 60 percent of the value of the property are available to qualified buyers and from an investment perspective there is a strong and ongoing demand from tenants for quality property to rent.
The capital city, Lisbon, currently being referred to as the ‘new Barcelona’ with a nightlife to rival that of Berlin, has it all, a trendy, vibey ambience yet steeped in history and culture, a world-class airport, quality accommodation and a place where English is widely spoken. The historic and leisure appeal of the city is significant as it attracts tourists and according to ‘aplaceinthesun.com’ ranks third on their 10 best places to buy abroad in 2017 index. Portugal is also enticing from a tax point of view, with relatively low tax rates of about 20 percent and no wealth or inheritance tax or tax on overseas pensions.
Immelman says South Africans are acquiring mostly investment properties – apartment style with very little maintenance required and easily lettable, priced between €500 000 and €1.5 million.
“Having access to cities like Barcelona, Madrid, Paris, Amsterdam, Berlin and Munich, among others, the benefits of gaining EU residency and ultimately citizenship becomes obvious. In addition, people are realizing more and more that a solid investment in hard currency is a non-negotiable factor in any savvy investor’s investment portfolio.”
Two out of many property investment opportunities currently available in Portugal include a development called Arco Augusta, situated in Baixa, right in the heart of the regeneration area of Lisbon, on the well-known street, Rua Augusta, which is close to the Praça do Comércio, one of the biggest squares in Europe. Arco Augusta is an old building that will be totally renovated while retaining its striking and authentic façade, with prices ranging from €400 000 to €900 000.
Another interesting option is Santa Helena, a magnificent and iconic old palace, with apartments priced from €700 000.
Visiting South Africa this month to participate in a series of road shows being held in Johannesburg, Cape Town and Durban are Pam Golding Properties partners in Portugal. These include the highly successful property developers, Stone Capital; local Portuguese real estate agencies with a broad range of existing homes, representatives from Monte Rei golf resort in the Algarve, Invest Lisboa who can provide investment advice regarding Lisbon in general; Sable to assist with the Golden Visa application process and Edge International Lawyers – their partners in Portugal.