APR also slams housing policy

A Portuguese resorts association is the latest to come out on the attack against the Portuguese Government’s ‘More Housing’ policy.

The APR (Portuguese Association of Residential Tourism and Resorts) emphasises that properties for tourism are the not the same as housing – they form part of tourism developments.
In a rebuttal to current misconceptions, the APR points out that establishments such as hotels, apart hotels, historic hotels (pousadas), tourist villages which are built, developed, marketed and explored by its members in the sector are “not housing”.
It explains that they are “not designed for Portuguese families and their day-to-day life” and cannot be made so under current legislation and council regulations. “They are in fact designed for temporary or holiday use, both for Portuguese and overseas visitors. This touristic offer involves converting permanent own homes into temporary holiday homes”.
Turning to the Golden Visa programme, it says that up until the end of 2022 around 3,200 Golden Visas were awarded for investment in tourist units (30%), while overall investment in homes for tourism represented around €1.1Bn. The estimate for 2023 is that 44% of investments (in property from overseas citizens) will have come from Golden Visas. Some 29% of this investment will have been made in tourism units (including second and holiday homes in resorts).
The APR has estimated that five years after an initial investment in a residential tourism unit, the new resident will have contributed six times the initial investment in the Portuguese economy, with a total potential of €3Bn over five years or 1.3% of national GDP and 18% of the RRP programme.
The APR suggests a raft of alternative measures that would contribute towards solving the housing problem for the Portuguese without taking away investment in tourism products from tourism regions that depend on it for their development and convergence.
It suggests creating a period of reflection of at least six months for independent studies on the impact of legislative changes to be carried out, introducing changes with a suitable transition period of six months of ‘vacatio legis’ to avoid a run on Golden Visas.
During this period of reflection, the current regime should only be applied for investments outside urban areas or in touristic units for temporary use, and apply regulations to limit renewals to new candidates only.
The APR also suggests reviewing the minimum amount for Golden Visa investment by studying the conditions offered by Portugal’s main competitors such as Spain, Turkey, Greece, among others, with any changes being competitive regarding other countries that operate similar residency by investment schemes. (There are 90 such programmes in Europe alone)
It also points out that there have been several “unfortunate situations” in which investors cancelled their investment plans in Portugal because of changes announced to the ARI (Golden Visa) programme, redirecting their intention to invest to other programmes in other countries.
The association also suggests creating a “special contribution” applicable to the acquisition of non-residential real estate as an “offset” which could be awarded towards financing affordable and social housing programmes.
Another suggestion from the APR is to create a Golden Visa for those who invest in buying and building new housing for the national housing stock earmarked for affordable rental, ensuring the acquisition of the property for this purpose at conditions previously agreed.
It also has come up with the idea of making unit trust funds applicable for Golden Visas if the money is fuelled into housing for rent. It suggests allowing Golden Visas specifically for funds which have a 100% investment in Portugal, with 60% for properties exclusively for rental, and 40% for other assets.
Another possibility is to create an ARI (Golden Visa) for the acquisition of shares in companies in which 75% of the assets are funnelled into properties for rental or affordable rental.
The APR also proffers maintaining the current criteria for the ARI in other types of funds, for example, tourism, energy, health and logistics.
In fact, the APR even thinks it might be a good idea to eliminate the term Golden Visas and substitute it for ARI or another term because the term has over time taken on “toxic and negative” connotations, making it now difficult to have any “rational debate as to its virtues and drawbacks”.
Its recommendations finally state: “We all know that the best solution for any complex problem requires constructive debate between all the parties affected, supported by facts and the objective analysis of the results and impacts – direct and indirect – of the current rules and intended legislative changes.
“The Portuguese Association of Residential Tourism and Resorts and its members are at the disposal of the government and its institutions to actively collaborate in the study, reflection and creation of a new overseas foreign investment attraction regime for tourism, making our knowledge, resources and direct experience on the ground available.”