Rich french flee to portugal

Photo: SuperJet International

Taxes in France have risen by 70 billion euros in the last three years, thanks to President Francois Hollande. As a result, the wealthier countrymen are looking for homes in nearby Portugal. Four years ago, Britons were once the biggest group of foreign buyers in Portugal. Now, it is the French, says real estate agency Aguirre Newman.

"Many of these wealthy French are coming to Portugal to take advantage of a series of tax benefits that are better than in other countries," Paulo Silva tells Business Week. Sotheby's confirms the surge in interest from its nearby neighbour, with French investors outnumbering those from both Brazil and the UK.

Portugal has been an increasingly popular destination for home hunters in recent years, climbing up the rankings on TheMoveChannel.com as confidence returns to those in the industry. It turns out that the French are a key driver of that interest.

"They like our country but they like our tax regime even more," one agent notes wryly.

Indeed, Portugal's laws mean that foreign pensioners who live there and receive their income from a foreign source do not have to pay tax. France, likewise, will not charge tax to the pensioners who are no longer residents.

The comments follow figures from the country which shows it has enjoyed a surge in demand from non-EU investors, particularly from China, as its residency scheme awards visas in exchange for purchases. While Lisbon has been a focus for Chinese investors, though, French buyers are snapping up homes all over the country, accounting for more than half of sales (together with the British and Chinese) in the first three months of 2014.

One Parisian property consultant told OPP Connect that now, 70 per cent of what they do is to help clients move overseas.