2015 Update on the Portuguese property market

As 2015 gets underway, the outlook for the Portugal property market looks generally rather positive.

Carvoeiro in the Algarve
While nobody is claiming an imminent boom, anyone following the local press is seeing a steady flow of positive stories and figures.
 
Back in October 2014, The Portugal News reported that the “national confidence index” was at its highest level since 2010, and that surveys showed increased sales activity and a stabilisation of prices. 
 
2014 also finally saw some price increases for the first time in several years. It’s important to note that these were, however, subject to some serious regional variations. In the first quarter of 2014 some areas of Central Portugal recorded increases in the region of 15%, while Faro’s figures (representative of the Algarve) were still slightly down.
 
Even within the Algarve, there are smaller microcosms of variation. The “Golden Triangle” area, which includes the celebrity-favourite resorts of Vale do Lobo and Quinta de Lago, has always (much like London) been someone immune to financial hardship, and the market there is currently buoyant thanks to investments in luxury properties from everyone from wealthy new foreign “Golden Visa” residents to former Dragon’s Den star Duncan Bannatyne.
 
Travel just thirty miles or so to the East, however, and there are still stacks of apartments going cheap due to excessive construction before the financial crisis. 
 
However, anecdotal evidence suggests that these are starting to sell, thanks to aggressive marketing and a general perception that while serious capital appreciation may take some time, the prices are unlikely to go any lower in the absence of any unforeseen events. There are still some bargains to be had on developments like these, but you may well find that the “best apartments in the block” have already been snapped up.
 
There are also some indications that it’s becoming a little easier to access finance for properties in Portugal, with lenders talking of 80% loan-to-value mortgages for non-residents, and even higher LTVs for residents. However, although there are still signs in certain resorts pertaining to offer “up to 100%” financing, it’s not easy to find anyone who’s actually managed to get accepted for such a deal!
 
Of course, for UK buyers, another huge factor right now is the exchange rate, with the pound worth €1.28 at the time of writing. This makes any property in the Eurozone, including Portugal, better value than it has been for some time.
 
So, if you’ve been dragging your heels about buying a place in Portugal, it’s perhaps unwise to let them drag for that much longer. Property investment is always something of a gamble, but there are enough indications right now to suggest that now is as good a time as any to make the jump. 
 
All that said, the cautious will have their eyes on Greece and their possible Eurozone exit, and the chance of contagion to countries like Portugal. Nothing in this life is guaranteed!

Further reading for Buying In Portugal

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Viewing Guide

Finding the right property can be a challenge. What do you need to think about early on?
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Hidden Costs

The price of the property as listed is never the price that you will end up paying. There are a host of other costs.
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Legal Matters

Buying a property in Portugal has very different legal requirements to the UK.
Read more...
 

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Currency Zone

Did you know that you could save thousands of pounds when emigrating by using a currency specialist?
Read more...