In Portugal, there are ±1.1 million second residences, according to National Statistics Institute data, comprising 80% of “AL” offerings. These dwellings have a low utilisation rate: less than 30 days a year. When engaged in Local Lodging, the average yield per owner is €11,000 euros. Lisbon and Porto tell a different story. In these two urban areas, “AL” is driven primarily by investment properties, not second residences, and foreign buyers.
The average cost of Local Lodging in Porto approached the values registered in Lisbon – approximately €100 euros per night – according to recent data calculated and released by Confidencial Imobiliário. In 2017, there was a 30% gap between the 2 cities. According to the index, the highest average daily rate was recorded in Lisbon in the Chiado-Bairro Alto district (€138).
Lisboa will increase the Municipal Tourist Tax in 2019, from one to two euros per night, to strengthen urban cleaning and transportation in neighbourhoods with more pressure from tourism. Initially approved in 2014, the Municipal Tourist Tax began to be applied in January 2016 on the overnight stays in the hotel units or local accommodation, then set at one euro per night up to a maximum of seven euros.
795 out of 806 tourists surveyed (98%) said that they feel safe in Portugal. A survey conducted by the “Universidade Nova de Lisboa” (New University of Lisbon) revealed that only “natural beauty and heritage” have more relevance than security when choosing to visit Portugal.
The Global Anti-Corruption Consortium recently presented a report revealing important data on the obscure world of Golden Visas. Four EU countries sell citizenship, twelve offer permanent residency permits. Golden Visas have lead to over 25 billion euros invested in the European Union over the last decade.
Critics say that the European Union should simply ban the practice. The sale of Golden Visas poses a serious security risk for the European Union in general and the Schengen system in particular. “It is a prostitution of the Schengen system, giving a fast track to rich migrants who are often kleptocrats, criminals and money launderers.”
Through Golden Visas, more than 100 thousand people have already obtained authorisation for permanent residency or citizenship in throughout member states. Portugal is one of the EU countries that has benefited most from selling Golden Visas, averaging €670,000,000 each year since inception.
Returning ex-residents will benefit from a 50% exclusion on earnings from salaried employment (Category A) and business and professional income (Category B). Only half of the income will be taxed under the proposed changes in IRS rules. According to the State Budget Proposal for 2019, this regime will apply for five years from the year in which the citizen meets the eligibility conditions. Any entity responsible for withholding income earned by returning former residents will be subject to a withholding tax on half of the attributed income, thus ensuring full application of the tax break.
The legislature voted in favour of the PS proposal mandating that the minimum term of lease contracts should be 12 months. The minimum time period does not apply to contracts for non-permanent housing or special transitory purposes, namely for professional motives, education, training or tourism.
Chinese investment in Golden Visas fell by 24% between January and August year-on-year to €194.3 million. During the same period, Turkish investments more than doubled to €69.4 million. Brazilians accounted for €86.7 million, 41.8% less than a year earlier. South Africa declined 47% to €22.8 million while Russia also fell to €20.3 million, a reduction of 202%. In cumulative terms, Golden Visas have yielded almost four billion Euros since inception, mostly in real estate.