The demand for properties over €1 million continues to attract buyers. The number of transactions recorded in the first quarter of the year is already in line with operations conducted in the years prior to the pandemic. The guarantee was given to Nascer do SOL by Patricia Barao, President of Residential JLL, stressing that this segment “has been systematically growing since 2016 and despite the percentage decline last year, as a result of the epidemiological situation, in the first quarter it is already showing values in line with Heaviness in the pre-Covid-19 years, which indicates the resilience of this sector.” Looking at this scenario, he has no doubts: “This year we will have one of the best years ever. Demand is high, the residential market showed resilience in testing and it was an exceptional year in line with the numbers before Covid ».
Contrary to what is expected, the purchase of this type of property is dominated by local buyers. According to the official’s calculations, in the first three months of the year, the national market accounted for more than 80% of the sales made. But, taking into account the average percentage of sales, the weight of the national market is 60%, while the international market stands at 40%. “We are a multinational consultant, so we work very actively with the international market, selling properties to 45 different nationalities. Brazilian, French, Chinese and English stand out,” says Patricia Barao.
But what is the secret of these transactions? The head of JLL Residential explains: “There is a huge demand for private properties where supply is scarce. Typically it is the unique apartments of a new project, penthouses, homes with special elements such as large outdoor spaces or private swimming pools that require greater demand, higher values and sometimes We have more than one client for the same property.” Our newspaper acknowledges that Portugal is increasingly consolidating itself as an emerging country in Europe in real estate targeting a more exclusive audience.” We were selling more properties at higher values than in previous years.”
Hence, much of the supply is sold even before it is completed, i.e., in the factory. In fact, a professional consultant. “We think the main reason there is potential in factory sales is that there is upside value to you when you buy at this point. There is high demand and little supply and buying in the factory leads to great interest from both domestic and foreign customers,” says Patricia Barao.
An opinion shared by the President of the Association of Real Estate Professionals and Brokerage Firms in Portugal (APEMIP), which ensures the fact that many projects are sold without completion is due to the confidence of investors and developers and, above all, in the anticipation of future value. “There are investors who want to secure the purchase of a project – still under construction – for both new construction and rehabilitation. Besides, everyone who buys the plant wants to have guarantees that it is making a good long-term investment,” Paulo Chiado tells Nascer do SOL .
But the “secrets” don’t stop there. “A premium market is characterized not only by the value of a real estate unit, but also by the features and services it offers. Whether for its unique or distinguished location, views (river, sea or city), leading architects, high ceilings or finishing above the usual standards, facilities for swimming pools, gardens, wildcard courts, spas, gyms, children’s spaces, and services such as as a guarantee and/or concierge,” adds Patricia Barao (see page 55).
Still, the official, realized that the real estate sector was not indifferent to the effects of periods of confinement, despite all the constraints that resulted and that ended up conditioning real estate activity. “But after almost a year, the market has shown resilience and is back to show exceptional activity in line with 2019 levels.”
Luxury stands up to challenges
Although recognizing that the pandemic has had an impact on the luxury goods market, as a portion of the customers in this segment are foreigners, and as such, they have seen their mobility stagnant for a long time, the APEMIP chief acknowledges that “the luxury market managed to meet the challenges” , and states that “as soon as the prospects for vaccination emerged, this segment regained its pace. The outlook is good, because people are still not as moving as they were in 2018 and 2019.”
Paolo Cayaddo says, however, that offering properties that have a very high value compared to others is rare and “what happens is that investors absorb these properties with higher values”. But he leaves a caveat: “This does not mean that the more expensive the property, the faster it will sell.”
For the responsible person, the prospects are encouraging. I think the residential real estate market has shown a positive upward trend in recent months. In the first quarter of 2021, between January and March, home sales amounted to 6.9 billion euros, an increase of 2.5% compared to the same period in 2020. Of this total, 5.6 billion euros correspond to existing housing and 1.2. One billion euros in new housing transactions. Given this scenario, there is no room for doubt: “The trend is that 2021 will remain a year of significant growth in the real estate market.”
It is true that the epidemic has left its mark on this market due to the slowdown in demand. According to the head of APEMIP, “the demand for housing slowed down in the initial phase of the epidemic, mainly due to the uncertainty that has occurred,” however, he ensures that “over the past few months it has been revitalized, proving that real estate value has a very strong component. People are more about their real housing needs, and as a result, there has been an increase in the number of transactions. The pandemic has also come to show that people are more discerning before they buy a home,” he told Nascer do SOL.
Paulo Chiado ensures that “Investing in real estate in Portugal continues to be a good business, especially when looking at the long-term market”. But let’s move on to the numbers. The official reveals that the vast majority of buyers are Portuguese, and using the latest data published by the National Institute of Statistics and analyzed by the APEMIP Studies Office, “230,776 properties were traded, indicating that only 19,520 properties (8.5%) were acquired by others.” Residents.
The race to the new job
“There is a huge demand for new construction projects.” The guarantee was granted to Nascer do SOL by Ricardo Souza, CEO of Century 21 Portugal and states that “in addition, the in-plant purchase also allows access to progressive payment terms, a fact which is very much appreciated by the Portuguese”. Indeed, the official acknowledges that “the Portuguese are dominant in all sectors, in the national real estate market” which “records very high levels of demand”.
For the official, there is no room for doubt: “The housing market has shown strong resilience in the face of the pandemic, which has also caused new housing needs for the Portuguese. Taking into account the conservative image of the Portuguese in terms of investment and with increasing levels of household savings, the residential market has become the main investment option.”
As for the luxury goods market, Ricardo Sousa ensures that it “has a very specific dynamism, and is inelastic to short-term dynamics”, while in terms of the traditional market, it is driven by low interest rates, increased market liquidity, by the growth of new mortgage loan operations and the fact 45% of Portuguese people want to change their homes as a result of the pandemic.
He added, “These facts and indicators that we record in the real estate market give us the security to estimate that this trend will continue in 2022 and with increasing levels of family savings, the residential market has become the main investment option.” in our magazine.
MaxGroup, of the Remax Group, reported that in the post-confinement period, there was an increase in the demand for luxury real estate by foreign buyers, ensuring that the demand spread throughout the Portuguese territory, even though Lisbon is the city of choice.
“To live or invest, Lisbon remains a very attractive city and has increasingly attracted buyers from the most diverse countries. He said that these real estate clients are now placed in the luxury sector and they see in Lisbon a set of factors that push them to make their purchase choice.
Among the criteria for selecting foreigners is the price, “since Lisbon is still one of the European capitals with reference values lower than those in Europe.” But there are other factors such as security, climate and tax incentives promoted by the protocols between Portugal and its countries of origin, as well as the history, light and stereotype of the capital.
It is true that the great global fortunes have their sights set on the Portuguese real estate market and, more specifically, on luxury homes. The conclusion comes from a study conducted by Al-Mazili that analyzes the international source of research on properties for sale in Portugal with more than 1 million euros. However, she is aware that there are some countries that have a special interest in luxury real estate in our country: Spaniards (11.7%) carry out the most searches for real estate of this type, followed by the English (11.6%), and North Americans. (9.7%), French (9.5%), German (8.9%).
This international interest in luxury real estate in Portugal is mostly concentrated in six regions, which accumulate 88.8% of visits looking for luxury homes for sale in the country. The data, broken down by region, reveals that Lisbon is the preferred region for foreign investors, with 40% of international searches for luxury properties concentrated in this region. The main interest in this luxury product are Spaniards (13%), North Americans (11.1%), English (10.8%), Brazilians (10.4%) and French (7.1%).
In the ranking of the six provinces with the most attention for high-status buyers comes the Faro region, with 28% of luxury surveys conducted by foreigners. The nationalities most searching for luxury homes in the Algarve are English (12.9%), Dutch (11.5%), French (10.5%), German and Spanish (10% in both cases).
Third place in the ranking goes to Setúbal with 8% of searches. The countries that showed the most interest in this region were Germany (15.1%), Spain (14.1%), the United Kingdom (11.7%), France (10.5%) and the United States (7.6%).
The Porto region ranks fourth with 6% of luxury surveys conducted by foreigners. Spaniards showed the most interest with 13.6% of visits. Followed by Brazilians (12.5%), French (11.9%), North Americans (11.2%) and English (7.5%).
Fifth place goes to the island of Madeira, where 4% of the luxury searches conducted by foreigners are concentrated in Portugal. English (21.1%) and Germans (20.9%) are the most active in searches, followed by North Americans (5.4%), Swiss (4.6%) and French with 4.3% of searches.
Finally, in sixth place in the ranking, comes the Braga region with 2% of the surveys. The nationality most interested in this region was French (25.7%), followed by Brazilians (12%), Swiss (10.5%), Spanish (10.0%) and English (8.3%).
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