Portugal’s tax breaks, security attracting rich Brazilians. Locals complain about being priced out of real estate market.
The residential property market in Portugal had started the year with a positive outlook after weakening at the end of 2018, the latest housing market survey shows.
An imbalance between demand and supply is continuing to drive strong price growth in Portugal’s residential property market, the latest housing market survey suggests.
For the last three or four years, Portugal has been “a really great market to invest in,” said Ricardo Costa, chief executive of Luximo’s, an affiliate of Christie’s International Real Estate.
A city with a population of a little more than 500,000, Lisbon is the heart of a much larger metropolitan area with a population of around 2.8 million. The city’s residential market has largely recovered from the global financial crisis. Sales volume in 2016 was up 15 percent over the prior year, putting the market back on par with its pre-crisis pace in 2010, said Gustavo Soares, a managing director for Portugal Sotheby’s International. “Portugal, because of the weather, the hospitality of the people, the security, is attracting more and more people from other countries,” he said. “And we have lower prices compared to other European countries.”
British people seeking to buy a property in the European Union should not be downhearted by the referendum decision that the UK should leave, according to overseas real estate experts.
Those who are looking to purchase a holiday home overseas, for example, are likely to see that owning a property in the EU will only be marginally more complex than it is currently, according to Andy Bridge, managing director of A Place in the Sun.
He pointed out that citizens of the United States, Canada, Russia and many other nationalities own properties throughout Europe, so while it may become slightly more complex for British buyers than currently, they are not going to be prevented from owning property in Europe.
Lisbon has seen a surge in residential investment and development activity in the last two years, according to new research.
The city is emerging from economic difficulties in a nation which underwent an European Union and International Monetary Fund bailout in 2011 and various initiatives are helping to revive its property markets, says the report from international real estate firm Savills.
It points out that reform of Portugal’s residential tenancy laws, coupled with inward investor incentives, has spurred wide scale regeneration of the built environment, helping Lisbon to foster economic recovery faster than other parts of the country.
The availability of cheap finance, investment in infrastructure, appealing tax initiatives and a return to sensible pricing has prompted renewed activity in the Algarve’s property market.
Overall, the Portuguese property market’s decline since the economic downturn of 2008 is well documented. Prices in some locations popular with overseas buyers have fallen by as much as 50% in peak to trough terms.
But sales volumes and prices have responded, albeit in two phases, according to the latest analysis from international real estate firm Knight Frank. In 2013 the firm saw vendors start to adjust their prices, which led to an upturn in transactions.
The Netherlands is the best location for buy to let properties in the European Union with the highest rental yields of 6.57% as of April 2016, new research shows.
Belgium and Portugal are also attractive locations for buy to let investments, taking second and third respectively in the EU buy to let league table compiled from research by international currency firm World First.
Average yields were 6.47% in Belgium and 6.29% in Portugal while Sweden was at the bottom of the list with the worst yield at 2.88% with the UK with 4.28% placed 21 out of 29 countries.
Home prices in northern Portugal fell by as much as 35 percent after the global real estate crisis of 2008, but in the last three or four years, prices have held steady, and the number of sales has been growing, said André Borges, a broker with the Porto office of Portugal Sotheby’s International Realty.
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