Golden chance to soak up sun

Hundreds of investors from China are clamouring for a golden opportunity to invest in Portuguese property. Following clarification of a new visa system, which automatically offers residency in return for a substantial investment in either a home or business, the so-called "Golden Visa" is keeping Portuguese legal firms busy.

Now, everyone in Portugal, from the finance minister down, is hoping that the new rule, brought in earlier this year, can shine a little sunshine on the ailing economy.

The country certainly needs it. Prices of property have fallen by more than 20 per cent since 2008, the economy shrank by 3 per cent last year and, in a sign that virtually no new houses are being built, the number of construction companies that went bust last year was up by more than 50 per cent. Unemployment is at 16 per cent, while more than 2 per cent of the population, predominantly the young and educated middle classes, have simply left.

So the Golden Visa, officially the Autorizacao de Residencia para Atividade de Investimento, whose terms were revised in January, has a lot of work to do.

The details are simple: in return for buying property worth more than €500,000 (HK$5 million), or investing more than €1 million in a Portuguese bank, or business or by creating 30 jobs, overseas buyers get a permanent Portuguese visa, which is a door into Europe. All investments must be held for five years.

The move has been pushed by the country's minister of finance under the Living in Portugal campaign, which aims to attract investment in the residential tourism segment, which in turn can contribute to job creation in the property sector. However, the name of the campaign is perhaps misplaced, as early indications seem to be that investors are looking to buy in Portugal, but not stay in Portugal.