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Moving to new shores

Grenada Caribbean

The recent violence and looting in South Africa, combined with the tardiness of government’s Covid-19 vaccination programme, has led to a spike in demand for second residency and citizenship programmes

The recent violence and looting in South Africa, combined with the tardiness of government’s Covid-19 vaccination programme, has led to a spike in demand for residency and citizenship programmes that offer dual citizenship

As the epicentre of the coronavirus meets the brunt of the violent protests in Gauteng and KZN, the vulnerability of South Africans is called into question. The current crises have further compounded the rising crime and security concerns of recent years. People want to live and work in a safe environment and are looking for the mobility that a second passport offers, says Nadia Read Thaele, founder and CEO, LIO Global, a leading firm specialising in second residency and citizenship by investment.

Dual citizenship not only provides the safety and peace of mind that many look for, but also secures their investment into politically and economically stable countries. “The countries we work with which have citizenship by investment (CBI) programmes – generally into property or by way of a government donation – allow for dual citizenship which is ideal for South Africans who don’t want to leave the country as yet but are now urgently looking for a plan B option for just in case. People are feeling nervous and dual citizenship offers easier travel despite lockdown conditions,” she says.

According to a recent New World Wealth report, about 4,200 super rich have left SA since 2010, and she says the number of families looking for a second residency and citizenship options continues to increase dramatically. There are many residency and CBI options available to South Africans, including European countries such as Portugal, Malta, Greece, Spain, Italy and Belgium. Most require a real estate investment and have complex requirements should you wish to acquire citizenship, as they’re geared at offering residency. Malta, for example, also has a citizenship programme in addition to its residency programme, but it requires a substantial investment upwards of R17m.

Umbria in Italy is offering dual citizenship

The Caribbean

The more accessible options are those offered by the Caribbean countries such as Grenada, St Kitts and Nevis, Dominica, St Lucia and Antigua and Barbuda, which offer a direct route to citizenship and a passport, as opposed to just residency. “They offer a quick route to a second passport in under six months. There are also no language requirements, and the countries are tax-friendly jurisdictions.” The required investment into property starts at just over R3,3m for a family of four, or from R1,5m as a government donation. “This is very accessible and equates to the price of an investment apartment on the Atlantic Seaboard or an upper middle-class home in the suburbs,” she adds. The property developments generally offer the opportunity for rental returns and can be sold after a holding period of around five years, with some even offering guaranteed buy backs, she adds. The Caribbean passports offer excellent mobility with visa free access to the USA, UK and eurozone for extended periods. The most popular, currently, is the Grenadian passport due to the E-2 Visa Treaty which allows citizens to invest in the USA, live and work there, and also send their children to US schools and universities.

Portugal

Portugal remains an enticing option for European investment. Portugal’s property market is quite affordable when looking to invest in Europe, especially in comparison to properties in France, Spain and the UK. South African property developer John Rabie has diligently been creating opportunities for investment in Portugal. In 2019, his company, Neworld, partnered with GMG Real Estate, creating approximately €90m (over R1,4bn) in residential and retail developments.

There are three good reasons to consider Portugal as a second home:

1. Strict planning permissions apply to Portuguese properties to ensure conservation of the natural environment and to limit the number of new properties that can be built. This keeps the demand high for family residential properties.

2. Portugal is politically stable and has a low crime rate.

3. The property market is booming. In November 2020, Lisbon’s property prices rose by 5.83%. Due to the warm climate and scenic geography of Portugal, rental properties remain in high demand for short- and long-term periods.

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Italy

A new programme created by the Italian Revenue Agency (Agenzia delle Entrate) to encourage economically active people to immigrate to Italy, now offers South Africans a relatively inexpensive way to gain residency, followed by citizenship and an Italian passport, in less than a year. They will then be able to enjoy visa-free travel throughout the European Union and to many other countries where they might wish to do business, work remotely, or send their children to university.

“This is not a ‘golden visa’ programme like those that have been offered since the Global Financial Crisis of 2008 by countries such as Portugal, Cyprus, Malta, Greece, Grenada and even the US,” says Leana Nel, head of the Chas Everitt International Sales & Relocations division. This new programme, she says, is being offered by the Italian government in conjunction with a leading financial advice group and affiliate company, Arkadia. It doesn’t allow applicants to seek employment in Italy, but is an elective residency programme available to people who are able to self-sustain financially or wish to start a new business – and it’s available in SA through the Chas Everitt International property group.

“The costs attached to the new Italian initiative are just €100,000 (±R1,7m) for the main applicant to obtain residency, followed by citizenship and a passport – with family packages available for those with dependants – plus the cost of renting a property for 12 months.” Nel says the new programme is centred on Umbria, an attractive region at the heart of Italy that is known for its scenery, art and excellent cuisine, and where applicants are required to obtain a 12-month lease on a rental property. The monthly rentals for furnished apartments in this area start from around €350 (±R6,000) a month. Applicants whose residency has been registered are free to sublet their rental units for the remainder of their 12-month lease, return to SA until their documentation is ready and then go back and take up residence anywhere in Italy.

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Mauritius

Mauritius, where High Street Auctions is selling 17 properties this month, is the only place in the world where South Africans can buy luxury property as well as secure residency for three generations for under R6m, says managing director James Dall. The prospect of living halfway across the world and being a long-haul flight from family and friends is daunting, which is why many of those currently planning ahead are looking closer to home, he says.

“Mauritius offers not only social and political stability, a strong and diversified economy and a sophisticated financial services industry, but also an educated and bilingual workforce and a pool of skilled and qualified professionals.” Dall adds that Mauritian taxation is more favourable to both individuals and corporate entities, which are taxed at a flat rate of only 15%. Additionally, there’s no capital gains tax and Mauritian authorities don’t require any estate duty should an owner pass away.

The Mauritian government’s recent changes to investment thresholds and the extension of work, residence and retirement permits have further enhanced the island’s attraction for families looking to relocate to the island. “A significant advantage to buying property in Mauritius,” says Dall, “is that it allows South Africans to use their rands to invest in a dollar-based property market. And investors also have a choice of several exceptional and unique developments around the island, making it very easy to find a home to suit a variety of lifestyles and needs.”

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