Portugal Golden Visa Costs for Hotel Investors

Are you planning to obtain a Portuguese residence permit by investing in the hotel business? We recommend that you should study our experts’ estimations of the total costs based on the current rates and the related expenses. This article is also focused on the advantages of prompt applications for the program of the Portugal Golden Visa through hotel investments.

What to Invest in to Obtain Golden Visas in Portugal? 

The Portuguese residence-by-investment program for non-EU nationals offers an excellent opportunity to obtain a European residency in return for investing in the most promising economic sectors in Portugal that need funding.

Thus, the country encourages investors to consider new construction projects of four- and five-star hotels or the refurbishment projects of the existing facilities (including Marriott, Hilton, other international brands).

The good news is: to obtain a Portugal Golden Visa an applicant is allowed to buy from a developer a share in a hotel project for only 280,000 EUR. Such low minimum financial requirements are set for applicants going to purchase residential or commercial real estate in sparsely populated rural areas.

Why Is it Worth Investing in a Hotel Property to Get a Golden Visa of Portugal?

Advantages of investing in hotels (if you need to get a Golden Visa for Portugal) include the following benefits:

• Commercial investments in the tourism sector of Portugal are going to be quite profitable in the post-pandemic world.
• Such investments do not require technically any further facilitation once they are made (the task of their maintenance is performed by the personnel of the developer /management company).
• Hotel infrastructure investments yield high returns on investment and a decent income.
• Investments in construction, especially for the priority development sectors like hotel business in Portugal, quickly create new jobs and promote the overall economic growth of the country.
• You as an investor can spend future vacations at the nice hotel in which you have invested.
• The profitability of such an investment is higher than that of any residential real estate acquisition.

Which Minimum Investment into a Hotel Property Can Be Sufficient for the Golden Visa of Portugal?

The minimum financial contribution qualifying as a sufficient hotel investment for obtaining a residence permit in Portugal is as follows:

• 280,000 EUR in low-density rural areas, where economic development needs an urgent drive (e.g. Evora);
• 350,000 EUR in other areas, including major cities and resort areas (Porto, Algarve, etc.).

Which can be the Investment Time Horizon of a Hotel Investor Applying for a Portugal Residence Permit?

 If the sole investor is a bachelor, the process would be as follows:

First, an investment in the amount starting from 280,000 EUR needs to be made by the acquisition of a share in some Portuguese hotel project.

• This amount (shares) will be paid back by the developer in 5-6 years (depends on the project). Thus we can say that when applying for the Golden Visa of Portugal the applicant pays only for additional (related) expenses, including taxes and the cost of administrative services.
• The return on investment is going to range from 3% to 10%, depending on the hotel project.

Which Additional Costs Can Be Expected When Investing in a Hotel Project for the Golden Visa of Portugal?

The following additional costs (duties and fees) are payable to the public authorities by a real estate investor with a share of 280,000 EUR in some hotel project:

• the stamp duty of 0.8% of the real estate investments value (i.e., 1,120 EUR);
• the IMT municipal tax in the amount of 9,100 EUR (a once-and-for-all fee of 6.5% of the real estate investment value, paid when signing the; contract of purchase and sale)
• taxes, legal costs, the notary charges in the total amount of approximately 3,000 EUR;
• the fee for being issued a Golden Visa for Portugal in the amount of 5,336.40 EUR per family member;
• the fee for processing a residence permit application: 533.90 EUR for the primary applicant and 83.10 EUR for each dependent.

In other words, you will have to invest a total of about 300,000 EUR (including the hotel property share and all additional fees/expenses) if you are the sole applicant for the Portugal Golden Visa. The above-mentioned gross amount is for the first year only. Further costs, including expenses for the renewal of residence permits, will need to be covered in the second year and onwards as long as you remain in the status of the Portuguese residence permit holder.

Which Is the Minimum Net Value of All Costs of the Golden Visa Portugal Applied For by a Hotel Property Investor?

Let us take into account that the investor’s share in the hotel project in the amount of 280,000 EUR is going to be cashed out in 5-6 years (this investment will be returned by the developer to the investor without any risk to the status of the Portugal Golden Visa holder). With this consideration, the net cost of obtaining a residence permit will be about 20,000 EUR.

By making a wise choice of a project or property for the investment in the Portuguese hotel real estate, you can achieve the return on investment covering the above-mentioned associated costs of registration of the residence permit and may even profit from your investment.

Is It Feasible to Apply for the Golden Visa Portugal During the Pandemic?

It is important to note that due to the general worldwide crisis caused by the COVID-19 global outbreak, the profitability of Portuguese hotels has seriously declined. On the other hand, it also declined the gross costs of investment in hotels due to the fall of prices for commercial real estate, including hotel projects.

Such a situation prompts profitable investments in the sector of hospitality and the purchase of luxury hotel property at a solid discount. This means the time is right for investments! For more information or assistance, please contact us right now at the e-address given at the top of this page.

Why do we recommend you to hurry up? Our experts warn that the rules may get tighter for the Portugal Golden Visa applicants soon, and the prices are very likely to grow. That is why if you have an intention to apply, you should act as soon as possible.

Other reasons for making your decision without any delay include, for example, the news about the Portuguese authorities’ plans to amend the procedure of granting residence permits to investors. The relevant regulatory initiatives were actively discussed in the spring of 2020 and were just postponed because of other priorities caused by the pandemic, economic recession, and other current agendas.

Experts believe that the Golden Visa rules will get tighter in 2021. In particular, it is projected that Lisbon, Porto, and coastal areas will be excluded from the list of places where it is allowed to buy real estate, including hotels (for obtaining the Portugal Golden Visa).

The most pessimistic analysts expect that such important changes in the scheme of obtaining the Portugal Golden Visa will be introduced in January 2021. In other words, it is right now that you may catch the last chance to invest in Lisbon, Porto, and the coastal areas for residence.

The government used to state several times previously that no changes would be made in the Portugal Golden Visa program rules until the end of 2020. 

However, on February 4, 2020, the Portuguese parliamentarians discussed and approved the legislative proposals to allow the authorities to consider the removal of Lisbon, Porto, and coastal areas from the list of regions where property investment is legitimate for the Portugal Golden Visa purposes.  However, the government decided to postpone the change due to the pandemic.

Quite recently, the Portuguese authorities resumed negotiations with the interested parties to assess the feasibility of introducing the restrictions in early 2021. In the event of tighter rules, the Portugal Golden Visa will only be available if the investment is in real estate somewhere away from the coast, in remote areas. 

The local developers have warned that this measure could cost the Portuguese economy 700 million EUR annually (plus 85 million EUR of government revenues in the direct taxes). 

It would be a serious loss, especially during the pandemic, when it is necessary to attract the maximum amount of investment into the country. So far the Portugal Golden Visa program has been the main engine for the real estate sector, which accounts for 15% of the national GDP.

The Association of Real Estate Promoters and Developers (Associação Portuguesa de Promotores e Investidores Imobiliários; APPII) suggested to the government the idea of a 12-month transitional period. Moreover, many experts recommend that the minimum amount of investments allowable for obtaining the Portugal Golden Visa should be raised, instead of prohibiting investments in the popular regions.

Besides, Portugal is under growing pressure from the European Union’s central government demanding to shut down the  European residency by investment schemes, because of the general allegations of money laundering, tax evasion, and corruption of this program’s participants.

Can Cryptocurrency Be Used as a Means of Payment When Applying for the Portugal Golden Visa?

Official statistics show that from 2012 to 2020 foreigners have invested through the Golden Visa of Portugal a total of 5.5 billion EUR. In total, 8.7 thousand residence permits were issued for investments in Portuguese real estate. And, as noted by local realtors, recently there has been noted a growing interest in using bitcoins and other cryptocurrencies as a means of payment for transactions.

The local law allows such transactions, and they are actively used by crypto-investors. The Portuguese legislation is considered friendly to cryptocurrency. This jurisdiction has earned the status of a paradise for FinTech startups and is often referred to as the tax haven for cryptographic investors because there is no tax on the exchange of cryptocurrency for fiat currency.

Bitcoin has recently become an important asset and a popular digital currency that cannot be ignored. Bitcoins are traded on almost all stock exchanges and trading platforms. This asset is popular, among other things, because of the minimal costs of peer-to-peer transactions (it is cheaper to transfer funds using a cryptocurrency than using bank services). These features make Bitcoins an ideal tool for buying and selling high-value real estate, including luxury hotel real estate, for obtaining a Portugal Golden Visa.

Our InternationalWealth portal and our partners are ready to accept Bitcoin and other popular cryptocurrencies, including Ethereum, Litecoin, Ripple, Dash, Monero, as a means of payment for legal and other services of assisting in applications for a Golden Visa in Portugal.

Where and How Can One Receive Expert Support in Applications for the Portugal Golden Visa by Hotel Investment?

One should choose assets and make investments wisely, considering all available options, and weighing the pros and cons. This process can be accelerated by a customer-specific individual consultation, which can be requested free of charge by writing to the e-address given at the top of this page. 

Consultants of the portal are ready to offer several reliable hotel / residential development projects at a time, which allows you to make the right choice and apply for the  Portugal Golden Visa by investing a minimum of 280,000 EUR. Please, contact us for more information.