Where in Europe Do Wealthy South Africans Buy Property?
Whether it is a growing concern about the South African economy, the desire to move funds offshore, or simply the desire to become a global citizen and enjoy visa-free travel, a significant number of wealthy South Africans are investing in property internationally, often with a view to obtaining residency or citizenship in a foreign country, and currently it appears that Europe is their preferred choice.
The most popular emerging destinations for South African investors at the moment are Portugal, Malta and Montenegro.
Most buyers are looking for a solid offshore property investment that offers them either residency or citizenship and easy access to Europe. Some are moving there straight away, but others are looking for easier investment terms that only require them to visit the country for a couple of days a year.”
Attractive tax incentives are also high on the list of priorities for South African investors and the three countries all offer great tax perks to property investors.
Portugal’s Non-Habitual Residence (NHR) programme has attracted foreign investment to the country by offering attractive tax benefits to incentivise expats to consider relocating to Portugal either for their retirement or to establish a base to run their international businesses from.
This year, in spite of the Coronavirus Pandemic, business has been brisk. While all countries have been hammered by the worldwide lockdowns, certain countries such as South Africa have made irrational and economically destructive regulations, coupled with the fact that there is no trust between taxpayers and the ruling elite who have now secured loans.
Portugal’s Golden Visa has been around for a while. The visa requires investors to purchase a property, or multiple properties, with a minimum value of € 500,000, or to invest in specific real estate options to a minimum value of € 350,000.
South Africans love the fact that the investment allows them to live and work in Portugal, which also gives them visa-free travel throughout the European Schengen Area. After five years, they can qualify for permanent residence and potentially citizenship thereafter.
As a property investment, Portugal has been showing solid returns for over 5 years. The broad range of fundamentals that underpin and drive the Portuguese property market still exist. With the Covid impact taken into account, in Q1 & Q2/2020 there has been an adjustment in the prices of some overvalued properties.
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