Retirement in Spain versus retirement in Portugal: which country to choose?

For a comfortable and well-deserved rest, more than 10% of French retirees (according to Agence France Presse), decide to spend the rest of their lives abroad. If you are one of them, you may already be faced with a real dilemma: "To buy the house of my dreams, should I invest in Spain or Portugal? ». Fortunately, our experts are sensitive to your concerns. Here they will try to help you resolve your dilemma so that you can make an informed choice between "retiring in Spain" and "retiring in Portugal".

Investing in Portugal or Spain - an overlap of advantages characteristic of both countries

It seems, because of their similarities in terms of assets, Spain and Portugal have enough to make more than one French pensioner undecided about investing in Spain. So what are the similarities between these two countries on the Iberian Peninsula and the preferred destinations of French retirees?

The advantage of always being close to France

Portugal and Spain are very close to France. As a result, they are as easily accessible by land as by air. Flights are frequent and competitively priced. Better still, it takes just over two hours to travel from both countries to France and vice versa. This is a great opportunity for you to visit your loved ones in France and receive them in your home, in Spain or Portugal.

The advantage of enjoying your rights as a European citizen

Spending your life as a pensioner in Spain or Portugal gives you certain rights promoted by European citizenship - in addition to your national rights. Firstly, you enjoy great freedom of movement. Secondly, you are not bothered about respecting the laws of these countries, since they are similar to those of France. Better still, your French rights can be taken into account in matters related to your health. And, in addition to the ease of your administrative procedures, you live in cultures close to yours, among others.

The advantage of living safely and confidently

In general, Spain and Portugal are politically and economically stable. They have no notorious crime or corruption. Moreover, they invest heavily in internal security (tourist police, private security, etc.).

Benefit from lower cost of living and availability of sunshine

Portugal (18%) and Spain (12%) are the top two destinations preferred by 47% of French retirees aged between 50 and 70, according to a study by Opinion Way. The optimal level of quality of life and permanent sunshine (almost 10 months out of 12) contribute greatly to the irresistible appeal of these two countries.

But the four points mentioned above are only common features of both countries. That is to say that each of these countries has its own specificities, its own advantages (and
disadvantages).

Investing in Spain - what are the advantages for French retirees?

When considering the investment aspect of buying a home in Spain for retirement, the "real estate" asset should be prioritized. The price of real estate in Spain is, overall, much more attractive than in Portugal. Moreover, under a Franco-Spanish agreement, French public sector pensioners living in Spain cannot be taxed twice from a pension point of view (they are only taxable in France, just as Spaniards living in France are only taxable in Spain).

Considering the other (non-exhaustive) assets promoted by Spain, the list will be extended by :
 

• Geographical position and natural heritage: the country is surrounded by both the Atlantic Ocean and the Mediterranean Sea; it has an exceptional variety of ecosystems and landscapes ;
• The performance of the health system: the Spanish health system is ranked 8th in the world (out of 193 countries), ahead of France (15th position) and Portugal (31st position), according to a study by the British magazine The Lancet (2017) ;
• Historical cultural wealth: Spanish culture draws its wealth from its history, so you will be spoiled by the uniqueness of the architecture, gastronomy, etc., of a warm and welcoming country.

However, although Spain guarantees an above-average level of health, safety, housing, etc., it does not only have advantages. It has some drawbacks: as a tax resident, for example, your tax rates can go up to 45% (depending on your income)... 

Investing in Portugal - what are the advantages for French pensioners?

The purchasing power of expatriates, coupled with the growing development of tourism, has led to an increase in the price of real estate in Portugal. However, this country represents a very attractive real estate market, making it easier for retirees to buy a home. Moreover, French pensioners who are taxable and enjoy a "private" pension are, under certain conditions, tax-exempt for a period of 10 years. But for how long will this tax advantage last? Impossible to answer for the moment.

In any case, investing in Portugal has other solid advantages that can justify this real estate investment:

• The lowest cost of living in the whole of Europe: it is 32.79% lower than in France, compared to Spain, which is 26.35% lower (source: Numbeo) ;
• The guarantee of being well protected: Portugal is the 3rd safest and most peaceful country in the world (Global Peace Index, 2017) .
• The list of advantages offered by Portugal is long (presence of preserved coastlines, advantage of being the most welcoming country in the world (Expat Insider survey), etc.).

However, one of the country's major drawbacks is the health care system, which leaves too much to be desired and yet is indispensable to a clientele of retirees. Now that you are edified, the last word is yours: choose between "retirement in Spain" and "retirement in Portugal". Whatever your choice, our experts will help you acquire the house of your dreams for an unforgettable vacation or, better yet, to spend the rest of your life as a French retiree...

The floor is yours...