In the second quarter 2018 Portugal’s GDP increased by 2.3% with to booming real estate market and chinese are the biggest investors in Golden visa scheme, which boosted property prices in Lisbon and surrounding areas.
Algarve attracts european investors for luxury properties along the coastline. Algarve has great climate and coastline best golf courses in the Algarve, lovely beaches and is only about 20 minutes from Faro airport.
Luxury prices on the Algarve increased 6.5% in 2017 year-on-year and mainstream prices in Lisbon stand 24% above their low in 2012.
A decade ago, 60% of buyers on the Algarve originated from the UK and Ireland but this has changed significantly with Northern Europeans (from Scandinavia, Germany and the Benelux nations) now active and the UK market share declining. The most notable trend has been a surge in French enquiries in the last two years, a trend we have seen in Spain as well, says Knight Frank in its report.
The Algarve’s Golden Triangle extending from Quinta do Lago to Vale do Lobo and Almancil remains the Algarve’s most exclusive second home destination. Villas below €5m have registered strong sales rates whilst at the western end of the coast, the area between Portimão and Sagres, villas below the €1.2m threshold are facing strong demand.
Unlike a number of countries, the Portuguese Government has not tightened rules on foreign ownership or increased property taxes. Instead, the absence of inheritance tax along with two key initiatives have
According to a report by Knight Frank
- Portugal’s Non-Habitual Residents initiative allows those employed to benefit from a flat rate of income tax (20%) and retirees can receive foreign income, including pensions, tax-free.
- The Algarve’s buyer profile is diversifying with more French, Scandinavian and Russian enquiries.
- UK, Ireland and German nationals search for properties in Algarve, rather than Chinese.
- The number of foreign tourists visiting Portugal increased 53% in the five years to 2017.
Rising House Prices
According to Statistics Portugal, Lisbon and Porto housing prices increased by 20% during the first half of 2018
The housing markets of Lisbon and the Algarve are markedly different from one another but both have seen an uptick in sales volumes, price growth and market liquidity over the last year. In the first quarter of 2018 (last 12 months), 40 municipalities located mainly in Algarve and in Lisbon metropolitan area, scored median house price of dwellings sales above the national value.
Algarve prices recorded at €1,424 euros per m2. The municipality of Lisboa (2 581 €/m2 ) registered the highest median house price of the country.
Source/Credit: Knight Frank Report 2018
