International Real Estate

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Thomas Youngman
  • Rental Property Investor
  • Portugal
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Property Investment in Portugal

Thomas Youngman
  • Rental Property Investor
  • Portugal
Posted Jan 8 2019, 17:57

Hi,

The purpose of this post is to connect with anyone interested/actively investing in the Portuguese Real Estate market. 

I am moving to Portugal in March 2019 and wanted to connect with fellow Property investors. There seems to be an interesting investment case for Portugal currently and by building a supportive network of investors we will be able to discuss opportunities and build our experience faster than if we go it alone

When I arrive in March I will be focusing on learning the market and seeing which strategies will work for me. 

Thanks

Thomas

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Juan Correia
  • Rental Property Investor
  • Portugal
25
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59
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Juan Correia
  • Rental Property Investor
  • Portugal
Replied Sep 1 2021, 05:31
Originally posted by @Guillermo Serrano:

Hello,

I'm new to the market in Portugal, currently "scouting" Ericeira. Anyone in the area would be keen on meeting up for having a coffee + pastel de nata :-) ?

 Hi Guillermo, I'm not in the area but let me know if I can help

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Replied Sep 1 2021, 05:39
Originally posted by @Greg Tomita:

Hi Everyone, I've been following this thread but wanted to introduce myself. My name is Greg and I'm a US based investor, LT and STR in AZ, FL and IN. I'm very interested in finding a property in the Algarve region or possibly another tourist driven area for STR and eventually living there more and more over the next 3-4 years. Love to connect and chat with others doing STR investing in Portugal, esp in the Algarve, Cascais area or surrounding. Thanks!

Hi Greg, 

I invest mainly in Cascais area, if you're interested in exchanging some ideas feel free to contact me.

Best regards,

Frederico 

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Replied Sep 7 2021, 15:25

Hello everyone. A coworker of mine wants to sell me her rural farmhouse in Portugal. Can anyone tell me about home equity in PT, how the Golden Visa program works in rural communities, and mortgages? I need to know if I can pull equity out after an appraisal is completed and if there are any construction/rehabilitation loans for these old properties to make additions to the property. I'm even considering flying out this weekend if someone in Portugal is available to meet?

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Joshua Beneventi
  • Realtor
  • Lisbon Portugal & Scottsdale, AZ
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Joshua Beneventi
  • Realtor
  • Lisbon Portugal & Scottsdale, AZ
Replied Sep 10 2021, 11:58

@Alex Cochell Please see the links below. They should provide you with a general understanding of the home-buying process in Portugal.  

https://getgoldenvisa.com/buyi...

https://www.portugalhomes.com/...

Min. investment in rural areas is 280 k. Funds must come from OUTSIDE of Portugal (so you could not apply for a Portuguese loan and qualify for the golden visa). 

What area is the property located in?

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Replied Sep 10 2021, 13:58

Thanks @Joshua Beneventi. I will check out the links. It's out in Alentejo. Wine and farm country. The breadbasket of Portugal.

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Replied Sep 13 2021, 01:04

Hi everyone, 

This thread seems to be exactly what I was hoping to find! I'm new to the forums but I've been listening to the podcasts and webinars for a while. I'm hoping you are willing to help me with recommendations or advice.

Background: I'm scouting in Portugal in October. I want to purchase property(ies) over time and work towards a D7 visa using passive rental income as part of the financial requirement. I won't be able to move for a couple of years.

I'd like to view available properties when I visit - if that's possible. I'm looking at Coimbra, Porto, Ponta Delgada, Evora and a couple cities in the Algarve. What are your thoughts on rental properties in Portugal? Originally I wanted to purchase small multi-family but I haven't seen that in the listings I've searched. So now I'm thinking flats or small houses in towns that would be attractive to multiple markets (potentially expats, tourists, students, locals).

1. Can anyone recommend good real estate agents and property managers in the cities above?

2. What do you find to be the best avenue for rentals in Portugal?  Do people have reservations about long-term rentals - are short-term rentals better?

3. What missteps should I be wary of?

4. Are some banks better for mortgages than others (in terms of down payment, interest rate, length of mortgage etc.)?

5. Anything else you think is useful to know?

Thanks in advance for your time and for any information, I truly appreciate it.

Kind regards,
Kate

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Juan Correia
  • Rental Property Investor
  • Portugal
25
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59
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Juan Correia
  • Rental Property Investor
  • Portugal
Replied Sep 14 2021, 03:56
Originally posted by @Kate Van de Goor:

Hi everyone, 

This thread seems to be exactly what I was hoping to find! I'm new to the forums but I've been listening to the podcasts and webinars for a while. I'm hoping you are willing to help me with recommendations or advice.

Background: I'm scouting in Portugal in October. I want to purchase property(ies) over time and work towards a D7 visa using passive rental income as part of the financial requirement. I won't be able to move for a couple of years.

I'd like to view available properties when I visit - if that's possible. I'm looking at Coimbra, Porto, Ponta Delgada, Evora and a couple cities in the Algarve. What are your thoughts on rental properties in Portugal? Originally I wanted to purchase small multi-family but I haven't seen that in the listings I've searched. So now I'm thinking flats or small houses in towns that would be attractive to multiple markets (potentially expats, tourists, students, locals).

1. Can anyone recommend good real estate agents and property managers in the cities above?

2. What do you find to be the best avenue for rentals in Portugal?  Do people have reservations about long-term rentals - are short-term rentals better?

3. What missteps should I be wary of?

4. Are some banks better for mortgages than others (in terms of down payment, interest rate, length of mortgage etc.)?

5. Anything else you think is useful to know?

Thanks in advance for your time and for any information, I truly appreciate it.

Kind regards,
Kate

 Hi Kate, first things first, wellcome to Portugal :) I hope everything goes well.

Answering the questions:

1- In the Algarve I recommend Golden Algarve. However, you should explore REMAX, KW and ERA, which are really strong here.

2- Depends on the location. I would say that Porto, Lisbon and Algarve will work better for STR and Vacation rentals, Coimbra for student rentals and Ponta Delgada I don't know.

3- You should be careful about location. Like everywhere else, one street makes a huge difference on the price. Also, get a good attorney and a good CPA, given that the laws and taxes are heavy.

4- It depends. I would say that for real state loans, Bankinter, Santander and Caixa Geral de Depositos are the best. Caixa de Credito is good, but it depends on the branch.

5- I think you should get to know the market before investing. I mean, get to know Lisbon before you go to Porto, because they are very different markets. Actually, I would start maybe with smaller markets like Algarve, or Coimbra, but that's me...

Best of luck!!

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Replied Sep 14 2021, 12:53

Thank you Juan!

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Joao Antonio
  • Investor
  • Elsene, Brussels Hoofdstedelijk Gewest
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Joao Antonio
  • Investor
  • Elsene, Brussels Hoofdstedelijk Gewest
Replied Oct 4 2021, 06:51

Hello Kate,

Although I'm Portuguese, i left the country many years and in the last 10Y I've been living Belgium (Brussels), where together with my wife we have invested in real estate / property management.

Over a year ago we moved to Portugal (Lisbon) with the kids and we live between Brussels and Lisbon. Similar to what we do in Belgium, we will be investing in Portugal and we started analysing the market.

I have no knowledge on the VISA topic so can't help you on this one.

-> Regarding the short / long term rentals:

- short term: tourism is one of the main sources of income of the country and therefore has lots of potential. Having that been said, the barriers to entry are very low, which makes it one of the easiest countries for anyone to start doing Airbnb, when compared with other countries. The downside is that everyone does it and unless you have something quite unique, you will deal with lots of competition and seasonality. In addition, a trend has started in some cities (i.e Lisbon) to incentivise owners to move their Airbnbs to the long term.

If you would like to do a market analysis on the short term rentals, I can send you some links of tools that are helpful (i.e Airdna) where you can check occupancy rates, average rates, etc.

- long term: there is a shortage of properties in almost all cities and in some cases and that has contributed to an increase of rents and prices in double digits in some cases. i.e Mafra 10% rent increases last year and Setubal +15% price increase. With this in mind, doing the market research well is key and I can share with you some tools / websites that i used for my own (for example idealista data or national stats), so you can check in which cities population is growing (just a few), unemployment rates, rent/buying $ per m2, etc.  

-> Funding: you can consider as options mortage brokers who can scout/compare the best offers in the market and you can also consider public funding programmes that exists as an incentive to renovate and bring houses to the market, either for tourism or traditional rental.

As an example, on the traditional rental there is a funding program ("Arrendamento Acessivel") that funds up to 90% of the project and can be used to cover part of the renovation costs, as well as, part of the purchasing. The caveat is that until the loan is paid back, you must put it in LT rental at capped rents. For tourism you have several, including one (IFFRU) that can fund up to 100% of the renovation costs (no purchase).

You can do your own research but you have companies / consultants who this job for you and charge a success rate (pay only if funding gets approved).

-> Besides doing your market research, i strongly advise that before any purchase or offer, that you hire professionals to help you in the process. Hiring an architect to assist you costs a few hundreds of EURs and they will check that the property is legal, they will take the right measures (in the end you often buying per m2) and guide you along the process. Additionally, an "avaliador" is someone you can (i recommend) hire to give you an idea of the market value of the property. They do an inspection, look for potential costs with repairs and produce a final report. This also costs 200-300 EUR depending on what's included. This are the best few hundreds of EURs you will invest and can save you thousands.

On my case, i'm currently in the process of investing in 2 properties in Sagres for tourism, as the zone belongs to a natural reserve and supply is very limited (i also hired the 2 ppl i mentioned above). I'm also analysing cities to invest in multi-family.

Don't hesitate to reach out as I'll be glad to help if i can and I would love to hear about your journey investing in Portugal.

Cheers

Joao Antonio

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Luís Ferreira
  • Rental Property Investor
  • Lisbon, Lisbon
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Luís Ferreira
  • Rental Property Investor
  • Lisbon, Lisbon
Replied Oct 4 2021, 07:21

Hi all, i had been absent for a while here. But i want to make myself available for anyone that needs help on the purchase of properties within Lisbon area.
My skills are investment, property management and luxury market.

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Justine Le
  • New to Real Estate
  • Vancouver, CA
0
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1
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Justine Le
  • New to Real Estate
  • Vancouver, CA
Replied Oct 4 2021, 18:46

Hi Everyone, I am Justine and I am new here and I am very interested in investing in PT for STR. I am an investor from Canada. This thread has been very helpful so far, so thank you to all that have contributed. I have not picked a market just yet as I am still learning. However, the markets I am interested in so far are, Silver coast, Azores, Madiera, Porto and I am open to learning about others in general. My ultimate goal is to acquire a few properties and hopefully work towards a D7 visa. For those who are investing in PT from a distance how have you found the experience. What are the avg cash on cash returns one can expect from the popular markets doing STR? Does anyone here have any experience with per hourly rentals for events using platforms like Peerspace? I am supposed to be meeting with a Portuguese realtor this week to learn more about the different markets I am interested in and get the ball rolling.

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Replied Oct 22 2021, 09:05
Thank you Joao,

I just noticed your post - I wish I had seen it sooner. I head back to the US in a couple of days... thank you so much for the information. I will look at the resources you've so kindly posted below. I think they will help me make informed decisions. If I might throw a few more your questions your way: 

I talked with architects/engineers who video and inspect properties in the Azores - do you know where I might be able to find similar people on the mainland?  
Have you used a buyer's agent in Portugal or did you contact the seller's real estate agents yourself directly?  
What is a good site to search for a mortgage broker?
One more question for the rehab programs you mention - I am not Portuguese - would I be able to apply for those programs as a foreign investor?

All the best,
Kate

--------------------------

Originally posted by @Joao Antonio:

Hello Kate,

Although I'm Portuguese, i left the country many years and in the last 10Y I've been living Belgium (Brussels), where together with my wife we have invested in real estate / property management.

Over a year ago we moved to Portugal (Lisbon) with the kids and we live between Brussels and Lisbon. Similar to what we do in Belgium, we will be investing in Portugal and we started analysing the market.

I have no knowledge on the VISA topic so can't help you on this one.

-> Regarding the short / long term rentals:

- short term: tourism is one of the main sources of income of the country and therefore has lots of potential. Having that been said, the barriers to entry are very low, which makes it one of the easiest countries for anyone to start doing Airbnb, when compared with other countries. The downside is that everyone does it and unless you have something quite unique, you will deal with lots of competition and seasonality. In addition, a trend has started in some cities (i.e Lisbon) to incentivise owners to move their Airbnbs to the long term.

If you would like to do a market analysis on the short term rentals, I can send you some links of tools that are helpful (i.e Airdna) where you can check occupancy rates, average rates, etc.

- long term: there is a shortage of properties in almost all cities and in some cases and that has contributed to an increase of rents and prices in double digits in some cases. i.e Mafra 10% rent increases last year and Setubal +15% price increase. With this in mind, doing the market research well is key and I can share with you some tools / websites that i used for my own (for example idealista data or national stats), so you can check in which cities population is growing (just a few), unemployment rates, rent/buying $ per m2, etc.  

-> Funding: you can consider as options mortage brokers who can scout/compare the best offers in the market and you can also consider public funding programmes that exists as an incentive to renovate and bring houses to the market, either for tourism or traditional rental.

As an example, on the traditional rental there is a funding program ("Arrendamento Acessivel") that funds up to 90% of the project and can be used to cover part of the renovation costs, as well as, part of the purchasing. The caveat is that until the loan is paid back, you must put it in LT rental at capped rents. For tourism you have several, including one (IFFRU) that can fund up to 100% of the renovation costs (no purchase).

You can do your own research but you have companies / consultants who this job for you and charge a success rate (pay only if funding gets approved).

-> Besides doing your market research, i strongly advise that before any purchase or offer, that you hire professionals to help you in the process. Hiring an architect to assist you costs a few hundreds of EURs and they will check that the property is legal, they will take the right measures (in the end you often buying per m2) and guide you along the process. Additionally, an "avaliador" is someone you can (i recommend) hire to give you an idea of the market value of the property. They do an inspection, look for potential costs with repairs and produce a final report. This also costs 200-300 EUR depending on what's included. This are the best few hundreds of EURs you will invest and can save you thousands.

On my case, i'm currently in the process of investing in 2 properties in Sagres for tourism, as the zone belongs to a natural reserve and supply is very limited (i also hired the 2 ppl i mentioned above). I'm also analysing cities to invest in multi-family.

Don't hesitate to reach out as I'll be glad to help if i can and I would love to hear about your journey investing in Portugal.

Cheers

Joao Antonio

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Miguel Alves
  • Rental Property Investor
  • Santa Maria da Feira - Portugal
1
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Miguel Alves
  • Rental Property Investor
  • Santa Maria da Feira - Portugal
Replied Nov 5 2021, 05:23

Bom dia a todos,

se quiserem imóveis na região do Porto e grande Porto, estou disponível para colaborar.

Possuo imobiliária.

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Joao Antonio
  • Investor
  • Elsene, Brussels Hoofdstedelijk Gewest
9
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Joao Antonio
  • Investor
  • Elsene, Brussels Hoofdstedelijk Gewest
Replied Nov 10 2021, 05:15

Hi Kate,

I just came last week from Azores and it seems not only a beautiful place but also great potential for STR. I will soon share some numbers of an analysis I did for that market.

-> Where to find people (architects, surveyors, etc): it’s hard to find people who operate on a national level, except for the main real estate agents. My suggestion is to study first the numbers / cities / markets and once you know your zones / cities of interest, look for people who can help you locally. For that you can use Google, FB and even Upwork. I recently started working with a surveyor that operates nationwide (www.valtecsa.pt). They will evaluate the property, eventual costs with repairs, etc - depending on the service you asks and their fees are about 250 EUR per report. I can share my point of contact of interests you.

-> How i do it: I personally like to do market analysis and then i do drive throughs + online search (www.idealista.pt is one of the best ones)

-> Mortage brokers: maxfinance.pt, www.decisoesesolucoes.com/intermediacao-credito, www.cafpi.pt, https://www.planos100.pt

-> Rehab - funding: being a foreign it’s not a problem, you can setup a company and still apply. There are consulting companies who do this (for a fee) and i can also share some contacts if you need some. 

Hope it helps and have a lovely day!

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Joao Antonio
  • Investor
  • Elsene, Brussels Hoofdstedelijk Gewest
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Joao Antonio
  • Investor
  • Elsene, Brussels Hoofdstedelijk Gewest
Replied Nov 11 2021, 07:34

Hello,

I’m currently investing in some units in the village of Sagres (Algarve) and prior to this process, I’ve done a market analysis for the short term rental market, which I have in mind for my properties. I’m sharing the findings here in case it’s useful to someone else:

Units / types of units

Market Bedroom Studio 1 Bedroom 2 Bedroom 3 Bedroom 4 Bedroom 5+ Bedroom
491 134 20 118 125 66 25 3



Occupancy rates 2021:

Market Bedroom Studio 1 Bedroom 2 Bedroom 3 Bedroom 4 Bedroom 5+ Bedroom
Av. Occupancy (%) 42% 36% 30% 45% 48% 46% 39% 50%
Av. Revenue (USD) 1,504 642 999 1,245 1,687 2,384 3,634 6,059



Revenue 2021:

Market Bedroom Studio 1 Bedroom 2 Bedroom 3 Bedroom 4 Bedroom 5+ Bedroom
Lowest monthly revenue 478 155 126 299 485 567 838 1,220
Highest monthly revenue 3,702 1,782 2,402 3,261 4,226 5,960 7,581 13,008



Top listings by revenue (2021) by type

Bedroom (USD):

26,267 - www.airbnb.com/rooms/41946699
20,739 - www.airbnb.com/rooms/41933482

Studio (USD):

15,938 - www.airbnb.com/rooms/8772597

15,513 - www.airbnb.com/rooms/43720842

15,505 - www.airbnb.com/rooms/43712535

1 Bedroom (USD)

46,729 - www.airbnb.com/rooms/43712535

41,631 - www.airbnb.com/rooms/44736230

34,878 - www.airbnb.com/rooms/43712535

2 Bedroom (USD)

46,764 - www.airbnb.com/rooms/44740576

46,753 - www.airbnb.com/rooms/27948666

46,568 - www.airbnb.com/rooms/35230483

3 Bedroom (USD)

65,067 - www.airbnb.com/rooms/30168418

62,927 - www.airbnb.com/rooms/30929693

60,572 - www.airbnb.com/rooms/7944597

4 Bedroom (USD)

95,798 - www.airbnb.com/rooms/4614025

78,379 - www.airbnb.com/rooms/21680999

72,150 - www.airbnb.com/rooms/23319248

+ 5 Bedroom (USD)

71,752 - www.airbnb.com/rooms/35859851

53,277 - www.airbnb.com/rooms/5413799

26,563 - www.airbnb.com/rooms/5281704

Other market info

- Average selling price m2: 2.680 EUR

- Average transaction value: 155K EUR

- Average rent (long term) per m2: 4.9 EUR/m2

The numbers were collected from a pricing software that we use to manage the pricing of apart-hotel units we operate.

With this information I was able to calculate the maximum I would be able to pay for property (including works, buying costs, etc), to have an edge for a positive cash on cash return.

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Derek H.
  • Investor
  • Boise, ID
4
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Derek H.
  • Investor
  • Boise, ID
Replied Nov 12 2021, 08:27

I have just read through the four years of this thread and found some great tips, thank you to the OP @Thomas Youngman and all the content others have provided. Looking forward to meeting you all virtually sometime, or in person on a visit to PT. 

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Joao Antonio
  • Investor
  • Elsene, Brussels Hoofdstedelijk Gewest
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Joao Antonio
  • Investor
  • Elsene, Brussels Hoofdstedelijk Gewest
Replied Dec 2 2021, 04:43

Hello,

Just sharing some short term market data about the area of Arronches / Portalegre, in case someone is thinking about investing in that area.

            # UNITS          Occupancy            Yearly Revenue (EUR)
TOTAL MARKET                530                 33%                994
Single Bedroom                 114                 21%              5,120
Studio                  7                31%               9,676
1 BR                95                37%               7,594
2BR              138               37%             10,764
3 BR               97               36%             13,122
4 BR               34               24%              18,262
5 BR +               45               23%              21,225

#

These are just the average values, then the top rental properties by revenue (EUR) are:

1st - 84.912 EUR: www.airbnb.com/rooms/1005100

2nd - 82.219 EUR: www.airbnb.com/rooms/15247902

3rd - 79.497 EUR: www.airbnb.com/rooms/13569807

#

I also have the data by category of property (studio, 1 BR, 2 BR, etc) in case someone is interested.

Be well.

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Tyler Henry
  • Investor
  • Parkland, FL
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Tyler Henry
  • Investor
  • Parkland, FL
Replied Jan 31 2022, 14:42

Hey, I was browsing through this thread. I was wondering as an American citizen, does anyone know of a good resource to check for what I would need to purchase property to live in permanently, full time on Madeira island?  I saw this site https://www.nobregarealty.com/buying that says:

"If you are not a European National and wish to live on the island permanently, you will need to invest a minimum pf €500 000 in a property in Madeira and comply to certain rules and regulations as well as applying for the Golden Visa Program in Madeira, Portugal."

Is there any truth to this?

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Tyler Henry
  • Investor
  • Parkland, FL
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Tyler Henry
  • Investor
  • Parkland, FL
Replied Jan 31 2022, 15:56
Originally posted by @Tyler Henry:

Hey, I was browsing through this thread. I was wondering as an American citizen, does anyone know of a good resource to check for what I would need to purchase property to live in permanently, full time on Madeira island?  I saw this site https://www.nobregarealty.com/buying that says:

"If you are not a European National and wish to live on the island permanently, you will need to invest a minimum pf €500 000 in a property in Madeira and comply to certain rules and regulations as well as applying for the Golden Visa Program in Madeira, Portugal."

Is there any truth to this?

Anwsering my own question...
https://mcs.pt/expat-services/portugal-golden-visa/https://mcs.pt/expat-services/...

It's related to the Golden Visa Program

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Warren Z.#2 International Real Estate Contributor
  • Investor
  • Tustin, CA
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Warren Z.#2 International Real Estate Contributor
  • Investor
  • Tustin, CA
Replied Jun 1 2022, 15:18

Hey Everyone! 

I'm headed to Portugal in July and will be there for a couple months to scout some properties. Has anyone purchased any STR investments in the last couple years? I'm specifically looking in Ereciera and the adjacent coastal towns. I'd love to chat and see what's possible in today's market.

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Replied Jun 9 2022, 13:57

If anyone is looking to partner up on investments in Portugal let me know. I can't at this point bring anything in terms of financials, but I can offer property management services or market research. Visit properties if you're out of the country etc.