Many real estate investors choose to place their trust (and their funds) in assets across the sea. Investments sourced in known destinations, such as the United States or Eastern Europe, have recently been joined by Portugal. Despite being an integral part of the EU and a developed Western country, Portugal presents foreign investors with opportunities as a developing market with a promising future, making its popularity soar.
A significant incentive for Israelis to invest in Portugal rests in the opportunity to obtain Portuguese citizenship for Sephardi Jews. Attorney Yoram Zara, who runs a leading law office that specializes in this area, explains: “In 2015, a law was passed in Portugal that enables Sephardi Jews to obtain citizenship. The law applies to Jews whose Portuguese Sephardi origin are can usually traced to the communities exiled to North Africa and the Ottoman Empire. This law has led to Israeli citizens’ requests to fulfill this right in recent years. To date, thousands of Israelis have received Portuguese citizenship via this route.”
Zara indicates that obtaining Portuguese citizenship is leading Israelis to examine the local real estate market in depth. “Visits to Portugal have caused Israelis to fall in love with the destination. This was made more difficult this year due to COVID-19, without which, it is reasonable to assume that even more investments would have been made, thanks to attractive rates and high yield opportunities in the country. Over the next year or two, thousands of more Israelis will obtain Portuguese citizenship, indicating that the Israeli investment in Portugal trend is just getting started.”
Buying real estate from far
“One can say that Portuguese citizenship has succeeded in breaking through a psychological barrier for many Israelis, who now feel a greater connection to the country,” says Eli Taieb, a real estate entrepreneur and the owner of “Emmanuel Investments Ltd.” The company, active within the Portuguese real estate market since 2017, specializes in several fields, from locating investment opportunities and recruiting investors, to leading and supervising all construction, marketing, and sales processes. Most of the company’s activities center on the northern city of Porto, while other assets are spread out across Portugal.
“Aside from the reasons already mentioned, Portugal is a country with a pleasant climate, political stability, convenient infrastructure, and a warm Jewish community. These factors are important to consider before deciding to invest money here.”
Another entrepreneur involved in the local real estate market is Yehonatan Gourvitch, the CEO and owner of YGI Investments, Lda, which deals in initiatives, asset management, and projects in the country, and even has a dedicated, Hebrew-language website for Israeli investors of all sizes. “The country is home to all advanced Western infrastructure, as well as a plethora of business opportunities. This is a market that has yet to realize all of the vast potential within its bounds.”
Gourvitch even refers to the sense of belongingness the country’s new citizens seem to espouse, which adds to their sense of security. “At the end of the day, we do business with people. When there is a positive atmosphere in addition to promising and profitable forecasts pointing to price surges for the next decade at minimum, one can understand the country’s allure.”
Comfortable funding conditions
Portugal encourages foreign investments and enables investors to secure bank funding, even in the absence of local citizenship. “Whether you hold local or foreign citizenship, you will find that Portugal is extremely welcoming of investments within its borders,” recount Vital Erlich and Omer Katanov, the creators of “Vital and Omer – Living Portugal,” Hebrew blog for the Israeli community about the life, innovation and adventures in Portugal.
They are the owners of LIVE ABROAD, a company that accompanies investors interested in purchasing real estate in Portugal, consulting, allocating properties, navigating the legal process, renovating, designing, and also managing it afterwards–
And the entrepreneurs of co-living projects such as "Communa Garage" in Porto. “Today, you can acquire nearly any asset at favorable rates and receive up to 70 percent funding from banks. This is not something you see every day.”
The two also indicate that an additional value linked to investing in Portugal that draws in investors from across the globe. “The real estate potential here is sky high. Before Covid-19, local tourism was record-breaking. As more Israelis receive Portuguese citizenship, we have seen a spike in Israelis’ desire to learn about the country, especially about the local real estate market, which has steadily grown over the past 7 years.”
“From a foreign investors perspective, Portugal is blessed not only with breathtaking scenery and a comfortable climate year-round, but also with a welcoming approach towards international investors,” adds Julia Fridman, the owner of Mojo Concierge Properties (MCPP), an established company providing boutique personalized guidance to investors and buyers interested in acquiring assets in Portugal. The service spans from scouting properties, navigating legal processes, to providing mortgage consulting and investment analysis, construction, and post-purchase asset management services.
“In Portugal, there is an added value for investors which stems from the high quality affordable local cost of living, as well as the possibility to buy properties at especially attractive prices with high levels of bank financing at low interest rates (between 1-1.5%). This country is teeming with growth, and even had a surplus budget in 2019, marking the remarkable economic progress Portugal has made in the last decade.”
Fridman additionally reveals her forecast for the coming years. “Despite Covid-19 the market demonstrated strength and stability. 2020 was concluded with an increase in prices of residential properties equal to 10% across the country and 15% - or even more – in high demand areas. For the most part, those who choose to invest here do not regret their decisions and most of our clients usually come back for more.”