Portugal Real Estate Investment Thrives Post-Golden Visa

Despite the end of golden visas, FDI in Portugal's real estate surged to €892.8 million, reflecting a 30% increase in Q2. Discover the trends.

Foreign Direct Investment (FDI) transactions in the Portugal real estate market have experienced a notable surge in the second quarter, reaching a staggering €892.8 million—an impressive 30% increase compared to the first quarter of the year. This uptick comes on the heels of a significant policy shift initiated by the previous government under António Costa, which opted to terminate the golden visa program in Portugal. Initially, this decision appeared to cast a shadow over the market, as early data suggested a decline in transaction volumes and a corresponding slowdown in the overall FDI value within the real estate domain.

However, the narrative has taken a turn since the AD Executive, led by Luís Montenegro, signaled its intention to reinstate the golden visa program in Portugal during the recent election campaign. This announcement has seemingly revitalized investor confidence, as evidenced by the latest figures released by the Bank of Portugal. The data indicates that FDI transactions have not only regained momentum but have also soared to one of the highest levels recorded in recent history, particularly between April and June.

To put this into perspective, the €892.8 million in FDI transactions marks the fourth highest value since the inception of record-keeping in 2008. This figure follows a remarkable peak in foreign investment in Portugal transfers during the third quarter of 2023, just prior to the cessation of residence permits for investment—commonly referred to as golden visas—through property acquisitions. According to reports from Negócios, based on the most recent data from the Bank of Portugal, this quarter's FDI transactions represent approximately 30% of the total foreign direct investment registered in the same timeframe, which amounted to €3.1 billion.

With this latest increase in FDI, the accumulated "stock" in the Portugal real estate markethas reached a new historical high of €32.9 billion. Overall, the total accumulated stock of FDI in Portugal has risen to €183.9 billion as of the second quarter, with a noteworthy 18% of this figure attributed to real estate investments. As the market continues to evolve, it remains to be seen how these developments will shape the future landscape of foreign investment in Portugal.