An international outlook and visa incentives boosting Lisbon property market
International developers are boosting the property market in Lisbon while Government incentives are attracting more buyers from overseas, a new real estate insight report shows.
In particular Government incentives’ known as the golden visa scheme, have been popular with figures showing that 7,291 residence permits have been granted to non-EU residents since its start in 2012.
The report from international real estate firm Knight Frank points out that prices are competitive in Lisbon €1 million buying 125 square metres compared to London where it only buys 43 square metres.
Overall, international demand is strengthening with interest from Brazil, Turkey, France, the UK and China and buyers are also encouraged by more than just affordable prices, looking at a low cost of living, improving global transport connections and growth in investment.
Indeed, it adds that with three tech parks, 90 higher education institutions, two universities and a vibrant start-up scene, Lisbon is emerging as one of Europe’s creative hubs.
Introduced in 2009, the Government’s Non Habitual Residency (NHR) initiative allows anyone who has not been resident in Portugal for the past five years to receive pension income, rental income, capital gains on real estate and non-Portuguese income tax free.
The NHR is valid for 10 years. Although Golden Visas are common in a number of southern European economies, Portugal’s scheme, which started in 2012, has been one of the most popular.
There are different ways of obtaining residency, 6,879 opted to purchase real estate via an investment of €500,000 or more, 397 transferred capital and 15 created a minimum of 10 jobs. The latest data shows Chinese, Brazilian and Turkish buyers have been the most active applicants. The report adds that there is currently no inheritance tax, gift tax or wealth tax in Portugal.
Built on seven hills, Lisbon offers a mix of neighbourhoods, each with a distinct feel. The Avenida da Liberdade is the central spine of the old town running down to Baixa, the historic quarter, providing easy access to theatres, restaurants and the waterfront.
The upmarket district of Chiado, the city’s cultural heart has largely been rebuilt following a fire in 1988 and with prices now close to €10,000 per square meter, the area generates some of the highest premiums in the city.
To the west sits Belém, a quieter district with a village-like feel, overlooked by the Ajuda National Palace. Once home to dockyards and warehouses the area now offers green space, parks and plazas.
The coastal town of Cascais, located 30 kilometres to the west of Lisbon, is a second home retreat comprised of detached villas, world-class golf courses as well as good international schools.
The report also points out that there is a noticeable lack of rental stock which is driving the investment sector with gross residential yields of around 6% achievable in the city centre and 8% in the city’s outskirts.
And it adds that the new Monitjo Airport, due to open in 2020, will service 50 million passengers per annum, up from 28 million at present. A €210 million Metro project is underway which will result in two new underground stops and the regeneration of Cais do Sodré, the city’s main transport hub for trains, the metro and ferries.