Updated look at the Portugal Property Market

It would take a true optimist to surmise that Portugal’s economic woes are truly over, but there have been some signs of “green shoots” over recent months.

Image

Portugal has officially emerged from recession (albeit by only a tiny margin), and there has been good news regarding exports and a small drop in unemployment.

The housing market is still rather slow, however. In the Algarve especially, the overdevelopment that took place before the economic crisis is still clear for all to see. There are plenty of housing developments with vast numbers of empty apartments. Some of these are of high quality, but the developments are practically ghost towns out of season.

Many have also been repossessed from the developers, and are now being sold directly by the banks. This makes bank branches in your chosen area a worthwhile port of call if you are considering buying a Portuguese property, as there are undoubtedly bargains to be had.

By mid-2013, estate agents were already beginning to state that property prices in Portugal had “bottomed out.” Subjectively, there does seem to be truth in this, but that doesn’t mean Portugal has begun to see price rises. Some properties are still deeply discounted.

It would take a bullish investor indeed to think of a Portuguese property as a quick moneymaker, but those who are in it for the long haul and intend to spend time in Portugal themselves could find now a good time to start their property search.

High-end properties seem to be doing well, undoubtedly helped by Portugal’s new “Golden Visa” scheme, which offers fast-tracked residency to those who invest over 500,000€ in property in the country.

All in all, Portugal’s property market mirrors the cautious “green shoots” visible elsewhere in the country’s economy. There is, however, one cautious word of warning for those thinking about a “holiday let” style investment. The Portuguese government now taxes income from this kind of rental property at 28%. After cleaning and management fees, there may be little remaining profit.

Portugal remains a friendly, sunny and relaxing place to be. It may not be the place to make a lot of money from property right now, but for a lifestyle investment, you could do a lot worse.


Further reading for Buying In Portugal

Image

Viewing Guide

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

 

Image

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.
Read more...

Image

Legal Matters

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

Image

Currency Zone

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