starlightscamper

Hi,
I'm new to this forum, & am considering the idea of buying a holiday home in Portugal, so am starting to do some research on the country...

We hear how property prices have 'crashed' in Spain all the time on the news, but not much is said about Portugal....can anyone living over there advise on the current situation ??

Has Portugal been badly affected by the global recession ?

Look forward to any help / advice / info anyone can share.....

Thanx !

sir recorder

Yes, Portugal has been very badly hit by the recession, and is inflicting further serious economic damage upon itself with its policy of economic austerity. Dare I say, trying desparately to remain a member of the Eurozone is complete economic suicide for PT, as it for Greece.

The holiday and retirement home property market has crashed badly, more than in the UK, by as much as 35% over the past 4 years, in euro values. Deduct from that the very heavy resale costs [legal and estate agent fees] and local resale taxes, and buyers have shunned PT in their thousands, and there are vast numbers of empty unused properties for sale, awaiting buyers. Pretty much the same as in Spain. Perhaps there are bargains to be found with many thousands desparate to sell. But inquire after all the hidden or unmentioned costs of running a property: IMI, Condominum charges, internet and telephone costs, water, gas, electricity, fiscal representation, rental taxes if you want to rent, etc. etc.

To cap it all, PT is one of the most expensive countries in Europe in which to own and run a car. Eating out is not cheap, or not as cheap as it used to be. Inflation has been high over the past three years in euro-terms, and high VAT charges all make PT, as a holiday destination, not really competitive anymore, at least for Brits, who have been further knocked badly by a 20% devaluation of the pound. But come here to make your own mind up about this. Gone are the days when PT used to provide bargain holidays.

liveaboard

Yes, the prices of holiday homes has crashed; especially properties outside of convenient commuting range of towns.
It's a great time to pick up a bargain. Don't be shy about making low offers.
But do have a lawyer who is completely independent of the seller or the agent, to check everything for you before signing or paying anything.
Price drops are between 20% and 50%, depending how ridiculous the initial valuation was in 2008, and how desperate the seller is in 2013.

steve01

Prices are roughly back to around the 2005/2006 price levels.
The worst hit sector are the apartments, particulary inland and on unfinished / poor quality sites.
Our agents are saying apartments have dropped 30-50% and villas 20-35%.
We're being told at the moment that prices seem to have stabilised, but there are less new properties coming to the market and a low number of sales, so this distorts the figures.
My view is that anyone buying now will realise they had the bargain of a lifetime in 5-10 years time.
The good news is that general interest levels in property seem to be rising.
We've had 4 viewings this year - in the previous 7 months we only had 3 viewings and lots of interest from a recent private advert, previously very little from the same advert last year
Its a time to be sensible - good location, well maintained property and do your homework , lots of comparisons in the area to make sure you think the price is right.
The key is 'the right price' - not the biggest discount.
Good luck

EMR

It is a buyers market and there is an excellent choice of properties to choose from,
Sales are increasing slowly and fewer quality properties are coming to the market, we saw a 3bed villa in Carvoeiro close to the sea that sold within weeks of going on sale. As ever it is location location etc,. The cheaper properties tend to be in areas or developments that are not popular, have limited rental potential etc.
This is confusing for the buyer as they ask why is property a only E125,000 euros, when property B is E150k and C 185K. The only way is to look at then your self. DO not be tempted to go on one of those inspection visits as agents will show you only what is on their books.
Where in Portugal are you considering it is a country with huge differences in regions and what they have to offer.

Ignore Sir Recorder he is our resident Jonah.

sir recorder

And EMR is Dr Pangloss from Voltaire's Candide, hopelessly optimistic about Portugal, which is in very serious economic decline.

Property prices in the market you want to buy in depend on a huge Expat population willing to spend. The countries from where those expats originate are all in serious economic trouble. People will try to talk you up, claiming that the Baby Boomers of 60 years ago are the big buyers. But all their pensions and cash wealth have been seriously hit.

The_Hog

What a load of rubbish! I doubt if the Expat population even represent 1% of the housing market in Portugal.

EMR

SR quotes from the Daily Mail and Express , need I say any more.
UK expat population in Portugal is extimated at 50,000. Huge % isn't it !!!!

sir recorder

Here's an article describing just how bad a state the Portuguese economy is in

http://www.globalresearch.ca/deepeni...rtugal/5315588

50000 may be the permanent expat population, but the part-time second home ownership non permanent "expat" population is much, much larger.

sir recorder

Don't just take my word for it

Here's a very valid comment made on a property website

http://www.propertycommunity.com/pro...html#more-3719

"Why commit yourself to a piece of ownership when you know that prices will continue to fall, and taxes continue to increase. Why would ANYONE commit themselves and become the government's milk cow?"

The_Hog

Did you actually read the article? It doesn't say that property prices are down because Expats aren't buying..... In fact it says that as property prices are lower there is increaed interest from foreigners. Kind of blows your argument out of the water. An own goal methinks.

sir recorder

I did not quote the article, as it seemed to me that it was nothing more than property agents' hype: talking up the market. I quoted the more sceptical and independent commentator, and what to me seemed to be a far more honest assessment of the situation. You can choose to believe the agents' ballyhoo if you want to, but I don't.

Who is to say that property prices won't slip even further than they have done?

I see nothing special on the economic horizon in Europe, in PT, in UK which will cause any price rise in property values in PT for a generation to come.

EMR

SR will never let logic and facts get in the way of his/her opinions.
Portugal has its problems so does Spain, Italy, Greece, France, Ireland and the UK all have see significant falls in property prices and activity levels sine 2007/8.
On the Andrew Marr prog this morning one of te reasons given for the lack of growth and fall in government income in the UK is the lack of activity in the UK housing market.
I am not one to quote from selected news articles to support an arguement but if SR lookas at back editions of the Algrave Resident or Portugal News he will see many last year indicating that sales are increasing.

The_Hog

Yes you did. You said - 'Don't just take my word for it. Here's a very valid comment made on a property website.' That is quoting the article.
Make your mind up.......

Benny Dorm

SR appears to act by the 50-50-90 rule: Anytime he has a 50-50 chance of getting something right, there’s a 90% probability he’ll get it wrong