A new law in Portugal could force thousands of property owners, including Brits, to lose their holiday homes.
A new ‘water resources’ law will enable the Portuguese government to take back any land which was originally owned by the state. It is expected that the new legislation will mostly affect houses close to the sea – especially in the Algarve region; a region where hundreds upon hundreds of Brits and other overseas investors own property.
The new law will not apply to properties built before 1951, but those with more newly-built villas face months of uncertainty while waiting to see if their homes will be affected.
However, a Portuguese government spokesperson has denied that this new ‘water resources’ law is a land-grab, but states it’s an essential ruling to help maintain the country’s environment.
“The law was designed to preserve coastal, river and reservoir areas from over-development. It is within EU law,” the spokesperson said.
In the past couple of years Portugal has been actively seeking property investment from overseas purchasers, offering lower tax rates for foreign purchasers and even introducing a golden visa, allowing non-EU citizens the chance to become resident through a house purchase.
However, this new law could lead to many potential property purchasers turning their back on Portugal at a time when the country’s property market has already been dogged by falling property values for five years.