International property experts are saying there are clear signs of recovery in Portugal's property market, with the Algarve progressing at the fastest pace across the country. As the property market stabilises, optimism is increasing with investor interest returning to one of Europe's most popular overseas property investment destinations.
Alda Filipe, sales and marketing director at Vale do Lobo said: " We have indeed seen an important recovery and we believe it will be even more significant after Portugal leaves the intervention programme in May this year. As such, we are certain that in the last trimester of 2014, the concrete results will be far more evident. The market is definitely progressing. "
46% of sales are still to British investors although new markets such as France are emerging as a result of both the fiscal incentives and their extensive promotional work alongside the Portuguese Tourism Board throughout 2013.
Austerity measures in France have increased the influx of French buyers in Portugal over the last few months as many French nationals escape the " excessive " taxes imposed by the government last year. Marcella Spee Horta e Costa from Abloom Properties in Almancil said: " The phrase 'end of the crisis' is no longer wishful thinking or a shallow phrase used by politicians. It is actually proven with facts/results instead. "
Chris Garveigh of Fine & Country Praia da Luz commented on the improved market: " The UK housing market having picked up allows buyers to re-finance in the UK to buy here; UK buyers are fed up of waiting so long and have decided to go ahead before it's too late in their lives; the tax regime has become very interesting both for traditional and non-traditional markets; buyers/investors have picked up that the market has bottomed out so are keen to get in for the uplift; and banks have opened up a little to lending, especially when it's properties they now own. "
Many estate agents agree that the Golden Visa scheme introduced in October 2012 has given the Portuguese property market a clear competitive advantage. The programme grants residency visas to non-EU investors in Portuguese real estate on purchases in excess of €500,000. " We have seen an increase in Golden Visa buyers, but the main issue is working with the very high commission structures that are being promoted by Chinese agents and so it makes it difficult on a resale property, " said Joana Oliveira at Quinta do Lago.
Portugal has seen a 30% increase in sales over the past year due to the London property boom, the tax breaks offered under Portugal's non-habitual resident scheme and the Golden Visa scheme. Kerstin Buechner, director of Quinta Properties said: " We are currently in South Africa selling the Golden Visa and it is very popular. It is the best European programme and the only one which offers a passport at the end of it. It is especially popular in South Africa because the Rand is losing its value and people are keen to get some money out. Even if property does not increase in value, they will gain with the currency. "
Trends in Portugal's property market suggest the demographic of buyers to be aged between 40 and 60 looking for a second home for the family, either new or managed properties, golf-fronted villas and older properties in need of renovation. Many agents have noted an increase in buyers purchasing plots for personalised construction depending on the tastes and preferences of each client.
Agents are unanimous that a combination of increased demand and readjustment of pricing levels have created momentum in Portugal's property market. Across the Algarve, prices have dropped since the onset of the financial crisis and vendors who continue to overprice properties are seeing them remain on agents' books for prolonged periods.