Buying Property in Portugal

The high unemployment rate and aggressive moves by banks to foreclose on property has led to a large depression in house prices in Portugal. This means that now is the time to find a bargain. Compared to what’s available in the UK, Portuguese properties offer much better value. For example for the price of a property for sale on the Isle of Wight, you can buy a house twice the size with a pool in sunny Algarve.

According to a recent report by the Royal Institute of Chartered Surveyors and Confidencial Imobiliário, published in April 2012 and taking into account the market trends until March this year, the Portuguese property market is currently a buyers’ market, with banks and individuals looking to liquidate property assets. Whether you are buying as a holiday or second home, or whether you want to rent, there’s never been a better time to consider an investment in Portuguese real estate.

According to the RICS/CI survey, the lettings market is buoyant, as it benefits number of households who cannot currently access mortgage finance, and who are renting instead. Tenant demand is rising and rental income projections are solid.

‘Almost all comments from agents mention the critical impact that financial institutions are having on the market at present. Not only are credit restrictions limiting transaction volumes; banks are also aggressively trying to run down their distressed property inventory, which is being cited as an additional source of downward pressure on residential prices,’ said CI spokesman, Ricardo Guimaraes.

An apartment with a serviced pool in the popular holiday resort of Carvoeiro is currently on the market for around 135,000 euros. A rural escape in a cottage in the beautiful Algarve countryside could be yours for as little as 40,000 euros. For that, you could be enjoying stunning views, an open fire and typical Portuguese terraces and vineyards.

The quality of life in Portugal makes this an attractive place to invest in a second home, or even as an investment for your retirement. The cost of living remains low, with average grocery bills being 20% cheaper than in the UK, and heating and fuel costs around three-quarters of the UK cost. Families are important and children and the elderly are welcomed and well cared for. Away from the cities, the pace of life is leisurely and enjoyable.

Current exchange rate and interest rate differentials between the UK and Portugal mean that the UK-based investor is able to strike a hard bargain in Portugal. 2012 could be the best year ever to invest in the Jewel on the Atlantic.