Foreign sales up in 2018
MAIN IMAGE: View of the city of Porto across the Douro River in Portugal.
This is has been an unprecedented year in terms of foreign sales says property leaders. Dual citizenship, whether in Europe or a tropical island – this is what well-to-do South Africans want when investing in property overseas.
“It has been an unprecedented year in terms of foreign sales,” says Lew Geffen, chairman of Lew Geffen Sotheby’s International Real Estate. He says they’ve noticed that many people around the age of 40 have made alternative arrangements in terms of buying foreign property either because they are leaving the country or because of a guarantee for the future.
“Having gone through 8 recessions myself, I reckon that in terms of brain drain to other countries, this has been the worst. With the rand withering and political uncertainty, we are losing our talented 40 year olds,” Geffen continues.
Countries that offer dual citizenship
Richard Hardie, CEO of Knight Frank (Residential) says: “We’ve noticed that a lot of people are looking for options where they can get a dual-citizenship, especially if they can get a passport, so countries like Malta is an example that seems to prove very popular. It is affordable, easy to buy property (with options to either buy real estate or lease a property), put a certain amount of Euros in, then get a residency within two years with Schengen access and include all EU countries. There are also countries like Portugal, Greece, Spain, Cyprus and Bulgaria that South Africans are looking at.”
Geffen confirms this trend and lists the destinations, in terms of preference, as Portugal, Mauritius, Cyprus and the UK. The first three offer residency and all golden passports.
He says there is also immigration to Israel and to the U.S.A., and here too interest is ever growing. “We have affiliates in all these countries and for the first time the two-way trade is more prevalent outbound than inbound,” he says.
1) Portugal and Cyprus
For good reason, Portugal remains a highly sought-after destination for international property buyers – including South Africans, says Chris Immelman, Head: Pam Golding International. The Portugal Golden Visa programme, offering a residency permit following a minimum investment of EUR 500,000 (there is now also a reduced EUR 350,000 investment option), is certainly part of the allure as European Union residency for their families is the primary aim of most of the South African residential property buyers.
“It’s evident that many affluent SA residents are seeking to create international opportunities for their children while at the same time leaving a lasting legacy for their families – not just their immediate families but for future generations too,” says Immelman.
Portugal also forms part of mainland Europe and it’s relatively easy and affordable to travel from here to cities like London, Paris or Rome.
Since the Golden Visa Programme was introduced in October 2015 and up to June 2017, close to 200 South African investors have acquired residence permits, investing a minimum of €500 000 in residential property in prime locations mainly in the vibrant capital city of Lisbon.
Portugal has been a popular choice for international property investors for a couple of years but lately the island state of Cyprus in the middle of the Mediterranean Sea is also expanding it’s offerings. Here for an investment of EUR 2 million, you can acquire full European citizenship for life in just 4-6 months for you and your entire family up to the age of 28 years, with the opportunity to disinvest after three years by selling your property, but with the requirement that you reinvest EUR 500 000.
For investors in Cyprus, a key advantage is that citizenship can be passed on to future generations by descent, while a Cypriot passport also allows visa-free travel to 159 countries including Canada, Hong Kong, Singapore and the UK. It is an attractive tourist destination which is very strategically located at the crossroads of Europe, Asia and Africa.
2) Mauritius and Seychelles
“The Mauritian property market is an investor’s dream right now. If it were ever on your bucket list to own property on a tropical island, now is the time to turn that dream into a reality,” says regional director and CEO of RE/MAX of Southern Africa, Adrian Goslett.
“Part of the allure of this island is its Integrated Resort Scheme policy which allows foreigner investors the opportunity to gain permanent residency status simply by purchasing property for a minimum of US $500,000. This presents the perfect investment opportunity for South Africans who are hoping to purchase holiday homes or are considering taking the plunge and immigrating. Our main market is South Africans, but people from all nations are aware of the allure of this tropical island – particularly French-speaking nations, as Mauritius is predominantly an English- and French-speaking nation,” explains Errol Areington, broker/owner of RE/MAX24.
According to Dr Andrew Golding, CE of Pam Golding Property Group, now more than ever, Mauritius is a sought-after destination for South Africans. Over the past three years they have seen a significant increase in the number of families making this their home. There is also a need for skilled professionals on the island, so there is a demand for rental property from younger families moving there to take up work-related opportunities.
Another tropical island that is attracting attention is the Seychelles. On Eden Island in Seychelles, a fully functional residential marina development has been completed with over 500 (95%) homes already completed and 550 sold. All home owners qualify to apply for Seychelles Residency.