Real Estate

European Real Estate-Linked Investment Migration Programs In High Demand

<p>Even before the World Health Organization announced the COVID-19 outbreak a pandemic, applications for almost all of Europe's real estate linked Residence- and Citizenship-by-Investment programs were already on the rise.</p><p>In Portugal, the first quarter of 2020 saw a 25% increase in interest in it's Golden Residence Permit Program (GRP), with actual applications up by almost 50% compared to the same period in last year. According to the latest Portuguese government data, 95% of GRP applicants have invested their funds in real estate as opposed to capital transfers or business, injecting approximately EUR 5 billion into the country&rsquo;s economy over the past eight years.</p><p>It is clear now that acquiring alternative residence or citizenship enables wealthy individuals to diversify their portfolios via a resilient investment solution, while at the same time contributing significantly to the economic well-being of the countries that offer such programs, making it a win-win solution for both. In Asia, investors have long preferred real estate as a viable form of investment with healthy returns. At present, HNWI's are favoring European real estate-linked programs as a hybrid investment opportunity that includes multiple yields from real estate, as well as an alternative residence and/or citizenship providing them the option to relocate if needed.</p><p>The current corona virus outbreak is devastating countries in rapid succession - from struggling developing nations to global giants, no nation is being spared. Against a background of significant projected instability, investors with foresight are already engaging in their post-pandemic planning and reassessing their wealth portfolios by opting to diversify via real estate&ndash;linked investment migration programs.</p><p>Real estate has traditionally been seen as an investment with staying power that demonstrates decades-long returns. Real estate&ndash;linked investment migration has the additional value add of enhancing the investor&rsquo;s options for relocation or retirement, or both. The potential gains from investment migration&ndash;linked real estate over the lifetime of the investment are threefold including the core value of the asset, it's rental yields and global access as an ultimate hedge against market and political volatility.</p><p>In Cyprus, year-on-year applications for it&rsquo;s real estate-linked investment migration program reveal an even sharper trajectory than Portugal&rsquo;s, increasing by 250% in the first quarter of 2020 compared to the same period in 2019, generating substantial inflows of wealth and, more significantly, job creation across the socioeconomic scale for the country.</p><p>Once the COVID-19 crisis has been curbed and travel restrictions lifted, global mobility and international access will continue to be essential hedges against asset-value volatility and wider market challenges. Aside from the obvious benefit of providing a second or vacation home in a different country, real estate-linked investment migration is a long-term proposition that secures access to new markets, top educational institutions, higher standard healthcare systems, and a suite of investment and personal opportunities for both present and future generations.</p><p>According to a report &ldquo;Covid-19 and Regional Property Markets&rdquo; published by Savills Hong Kong last month, is it predicted that the pandemic will have an impact on real-estate markets across Asia Pacific in the near to medium term, with two major concerns which are changes in the uses of real estate and values placed on this real estate by investors and end-users. It therefore makes sense that whatever real estate you do invest in is able to provide you with multiple benefits, giving more value for the money you have put in, and real estate-linked investment migration programs does exactly that.</p><p>Real estate-linked investment migration programs, especially in Europe, are a reliable back-up plan for turbulent times, providing investors with unparalleled safety, security, stability, and opportunity, including access to major money markets. At this time, when markets are being dealt heavy blows, it is vital to remain calm and make strategic long-term decisions. As a tried-and-tested hedge against volatility, securing alternative residence or citizenship through a property purchase is one of the safest, most sustainable investments you can make right now.</p><p><strong>Real-estate linked investment migration options</strong></p><p><strong>Portugal</strong></p><p>The minimum real estate investment requirement for the GRP is EUR 350,000, and the permit enables one to apply for full citizenship after five years. All real estate sectors have witnessed a significant growth through foreign investment across all markets, ranging from large institutional investors to high-net-worth individuals, including GRP applicants. Portugal will therefore continue to be a hot spot for real estate investment.</p><p><strong>Cyprus</strong></p><p>In terms of citizenship-by-investment, it offers one of the most sought-after programs in the EU, with an option to commit at least EUR 2 million to the purchase or construction of real estate. Along with most other EU member states, Cyprus also offers permanent residence-by-investment at a lower price point of EUR 300,000 for the purchase of real estate plus VAT.</p><p><strong>Turkey and Greece</strong></p><p>In the period leading up to the COVID-19 pandemic, the real estate markets in other parts of Europe were also attracting considerable foreign interest, with much attention concentrated on nations offering residence- and citizenship-backed property options. Last year, for instance, almost 46,000 foreign nationals invested in real estate in Turkey, following a decision to reduce the minimum investment threshold of its citizenship-by-investment program from USD 1 million to USD 250,000 late in 2018. Early 2020 saw the trend for foreign real estate investment in the region continue, with almost 4,000 overseas buyers purchasing houses in Turkey in January alone. To date, approximately 5,000 investors have acquired Turkish citizenship via investment, making it one of the most popular programs in the world despite the relatively modest power of the Turkish passport, which gives its holders visa-free or visa-on-arrival access to 111 destinations. In Greece, where residence-by-investment is available through the purchase of property priced at EUR 250,000 and upwards, demand has been equally significant.&nbsp;</p><p>&nbsp;</p>
KR Expert - Dominic Volek

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