The property market is notoriously resilient and this has been fully demonstrated this year - demand has only increased and property prices at the top end of the market (Euro 3m+) continue to rise despite the uncertainty around Coronavirus, the global economy in general, and, dare we mention, Brexit.
While this resurgence in prime property sales could be due to a clearing of the backlog of transactions from the lockdown period, it’s not clear if this pace will continue, but for now, well into October, there seems to be no sign of a decrease in appetite for top properties on the Algarve coast.
Since January this year, we have negotiated over Euro 110m worth of property sales in the central Algarve. We have always focused our efforts on the very top of the market and it has been an interesting exercise to look at who our top buyers are and try and identify what is motivating them to buy here and why now.
Research suggests that the prime property market has recovered more quickly due to the financial position of buyers and the flexibility they enjoy. More affluent households are more resilient to market forces, less dependent on borrowing, and able to complete their transactions speedily. Furthermore, retired or not, they are less likely to be tied to an office and able to travel and work from anywhere.
Historically most of the buyers have come from the UK and Ireland, and many still do, but we are seeing more buyers from around the world. Several of our top buyers are moving to the Algarve with their young families; schools are of great importance as, of course, are safety and security, easily found in the Algarve. But most of the big buyers are simply buying a truly great holiday home and, of course, there are the investors.
Many of our buyers seem keen to make large investments at this time. We have heard on numerous occasions that they are less interested in keeping cash in the bank and are more interested in big-ticket items like gold, silver, serious art, and top real estate. All of these are seeing a marked increase in value this year and the upper end of the property market in the Algarve is feeling the effects of this also.
Over the past three years, we have sold a number of large properties in the Quinta do Lago and Vale do Lobo area for over Euro 18.000 per square meter. This is an important milestone for the country’s property market and represents values not seen before nationally. Price tags for individual properties of over Euro 10 million are now more and more common, with standards of construction and design able to compete with the best in the world.
Another interesting motivator is Brexit. UK residents, as members of the European Union, are today easily able to become Portuguese residents and possibly also take advantage of becoming Non-Habitual Residents with all its popular benefits. Post-Brexit will this still be as simple? Who knows.
In a world where safety and security, accessibility, and world-class facilities are in high demand, no wonder Portugal features prominently on the world map.
QP Savills have been the local Savills associates for over 20 years, they have 4 local offices and one of the most magnificent property portfolios in the country.
Director QP Savills
The Algarve is a golf enthusiast's dream destination due to award-winning golf courses, warmer winter climate, impeccable golf services, stunning scenery, and a wide range of aprés-golf entertainment options.
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