Earlier this year we ran a report about how ‘property in Portugal was not necessarily so popular’ after being inundated with what we felt were less than well rounded and researched articles about the property market in Portugal weathering the international war on real estate values.
Reports then went fairly quiet about the nation’s real estate offering for a while. But once again focus has been turned to Portuguese property following press releases reporting, among other things, that Zara Phillips has invested in the nation’s real estate market.
Added to this is the fact that the Global Property Guide has published findings that the value of property in Portugal is continuing to rise.
So, is it time for us to eat our words? Does property in Portugal prove to be a good investment?
Portugal is potentially good for the long-term investor, but that a short-term approach to investing in property in Portugal will not necessarily prove profitable.
So, no one can simply state that Zara Phillips’ commitment to Portuguese property makes the nation’s real estate market a sound investment bet at the moment – but those wanting to make it appear as though property in Portugal is now even more desirable can perhaps draw someone’s attention to the fact that now a ‘celebrity’ has bought in, so why don’t you! Nothing wrong with doing that in terms of legality or even morals – but you have to see it for what it is! Marketing manipulation!
Yes, there are some excellent fundamentals that support a long-term commitment to the market. For example, tourism in Portugal is strong particularly in the Algarve and increasingly along the likes of the Silver Coast. Tourism demand from the golfing community is particularly strong, consistent and a potential good long-term bet – this is a fact that an investor can keep in mind when thinking about targeting a sector for returns on any investment.
The economy in Portugal is relatively stable, relatively strong – as is the political landscape. Again, strong fundamentals for building a picture of the country from when considering whether to invest or not. However, taxation on property is quite high, the property market is fairly slow moving in terms of re-selling, and so these are reasons against a short-term approach to the market. So, yes there are reasons to consider an investment and no, there are reasons very much against a short-term approach to the market.
This all means that Portugal has potential, but not for a speculator – and that it is a market approached carefully, with a view to earning rental income over the long-term for example.