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Portugal Continues Making Strides In Property Market

Portugal Continues Making Strides In Property Market

Expectations were that Portugal’s property prices may begin to fall, the country's positive steps forward are however sustaining the property industry's continued to rise.

Among the most popular properties currently are development projects that generate guaranteed tourist rental income with typical yields of 4% per annum. As a result investors are acquiring real estate in new developments before construction has even finished. 90% of buyers are aged 55+ wirh British, American, Swedish and French citizens being the most popular foreigners purchasing property in Portugal - according to the results of a survey conducted by British property website Rightmove.

 

There are no restrictions on foreign property buyers in Portugal and transaction costs are fairly low typically 6% of purchase price. Since 2012, non-European investors have also been entering the Portuguese property market in increasingly large numbers due to the introduction of the Golden Residence Permit, which enables property investors to obtain residence permits.

 

Between October 2012 and June 2016, foreign investors obtained over 3,400 residency permits. The total cost of the residential property acquired by these investors amounted to approximately €1.9 billion with the average amount each buyer invested being €580,000.

 

Apartments are a clear favorite among foreign investors as shown in the Algarve where demand far exceeds supply. This is causing would-be property buyers to line up for a chance to buy choice properties, making it more difficult for buyers to find their dream homes.

 

Property used for holiday rentals are among the most interesting and popular real estate currently in Portuguese market with many investors purchasing to see a return on their investment. Across the Algarve places such as Albufeira, Vilamoura, Carvoeiro, Lagos, Olhão, Praia da Luz and Tavira are some of the most popular locations for those looking to invest. Bearing in mind real estate prices will vary significantly from location to location with Quinta do Lago being one of the most expensive resorts on the Algarve. 

 

What to expect from the market going forward analysts are positive about the Portuguese property market due to its proven record of resilience and relatively low property prices. It didn't suffer through a housing bubble prior to the 2008 crisis and its housing prices stayed afloat during the recession, Portugal's current market boasts prices that are particularly attractive when compared to others within the European market. 

 

Financial database Trading Economics predicted that the prices of residential property for sale in Portugal will continue to grow steadily in the coming years, with property prices expected to increase by 4.5% by 2020. The national economy is also expected to continue growing at a level of at least 1% per annum, further supporting housing prices.

 

If your ready to discover more about buying or investing in Portugal, we look forward to guiding you through. 

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