In October last year Portugal launched an initiative to encourage overseas investors to inject money into the domestic property market – and it looks like it is having the desired effect amongst potential Asian buyers.
The Golden Residence Permit mechanism offers foreign nationals a Portuguese residence permit, with many seeing it as a chance to gain entry to the wider European Union.
Having a residency permit allows freedom to work or travel throughout any of the 26 European states that are in the ‘borderless’ region governed by the Schengen Agreement.
Property developers report that it has already led to a significant increase in interest from potential buyers from the Far East, especially China.
The Portuguese government has announced that the scheme has attracted a "big number of potential residents and investors due to its advantages" and that the first visa has already been granted to an Indian businessman. The unnamed gentlemen invested a significant sum in a trio of hotels in Albufeira.
The scheme applies to investors from outside the EU who put at least €500,000 in Portuguese property.
In return, they are offered a five-year residency, with the option to apply for permanent residency after this initial period.
The scheme is relatively straightforward, although a few terms and conditions complicate things slightly.
Investors are required to buy a property before making a visa application and any properties involved in the process must be bought outright, without any charges or mortgages placed on them.
A number of Chinese investors are already engaged in the application process and interest has been high from potential buyers based in Beijing and Hong Kong.
Foreign currency exchange rates quoted by banks are almost always worse than the exchange rates available through specialist currency dealers. Therefore, it could be worth considering transferring funds for a property purchase through a currency exchange specialist.