From Portugal to Montenegro, a new generation of developers is trying to tempt the ‘expat dollar’ with luxury residences, backed by government incentives.
The dream of ‘a place in the sun’ has become a little more poignant in the last 12 months of lockdowns and travel restrictions, particularly for the residents of Northern Europe. Add in Brexit complexities for UK citizens, and hopes of establishing an overseas bolthole have significantly faded. Yet some savvy developers are seizing the moment to market luxury residences to the holiday-deprived, banking on government-backed investment incentives to win the day.
In Portugal, that means the Golden Visa scheme – a programme which offers residency via real estate acquisition for investors from outside the EU. In February, it was announced that current Golden Visa regulations would be extended from July to December 2021, with all applications now due January 2022.
‘The Portuguese government fully understands the benefits that Golden Visa applications bring to the Portuguese economy,’ says Chitra Stern, co-founder of Elegant Group, a hotel and resorts investor and owner which is moving into residential property for the first time with a Lisbon scheme. The delay on updating Golden Visa regulations is important for Elegant, as future terms will require investors to focus on regions outside the capital and away from the country’s coveted beaches.
‘While the government rightly wants to channel future investment into inland areas, it is critical to keep open the opportunity to attain a Golden Visa through real estate in Lisbon for the remainder of this year,’ Stern adds.
Elegant’s new project, Martinhal Residences, marks the firm’s first foray into developing luxury apartments for sale, building on its experience as hotelier and owner of holiday villas. Taking shape in Lisbon, with views across the Tagus river, the 1-4 bedroom apartments are situated in former Expo-site Park of Nations. Studios start at €340,000, with a four-bed duplex penthouse at €2,700,000.
‘More than half (56%) of our owner-occupier clients at Martinhal so far are Golden Visa purchasers, while the majority of those buying purely for investment purposes are Portuguese, followed quickly by buyers from other European and Latin American countries,’ Stern notes.
Montenegro woos investors
EU-candidate Montenegro, meanwhile, is wooing non-residents with its competitive property transfer tax and inheritance and estate taxes, set at just 3% - compared to 6.5% in Portugal and 10% in Spain. Azmont Investments has committed over €600 mln to date to fund the country’s flagship Portonovi resort, a 26-hectare leisure development combining residences and Europe’s first-ever One&Only resort.
Some 218 apartments are being marketed for sale at Portonovi, starting with the marine-front Marina Residences, boasting sea views and access to 238 yacht berths. Studios start at €345,000.
To date, almost €3 bn has been invested in the country’s 10 largest coastal developments, where Montenegro is also attempting to court Russian travellers, with increasing numbers of direct flights to Moscow. Attracted by its low corporate tax rate, the number of UHNWIs in Montenegro is expected to increase by 36.1% over the next four years, according to Knight Frank’s 2019 Wealth Report.
