sportpix

Although our investigative trip to Portugal is not until the end of May we are already thinking of buying a villa on a golf development which we would live in while we take our time to look for somewhere else more suitable to our needs. We would then rent out the golf villa. Given that the property will eventually be rented out and hopefully providing an income, should we be looking at other types of property that might be more appealing to the holiday rental market? I've been reviewing forum comments on Portuguese golf developments and some visitors maintain it's the best place they have ever been on the planet while other comments give chapter and verse on why you should never stay/play there.

I've tried to follow the recent threads on NHR, registering as a local and swapping British driving licences for Portuguese ones but still have a thousand questions to ask. My UK driving licence is the old A4-size pink paper one as I've not lived in the UK for 30 years. Is this still seen as current? Sorry if this has been asked a million times before, but if we were to buy a place when we visit in May, would we be required to stay in the country for a specified period of time before we register with the local authorities? As the corona virus has practically wiped out my work schedule for the first half of the year I'm wondering whether to make a visit earlier than our planned May visit and to get the ball rolling.

mfesharne

You can exchange the old pink licence & same rules apply & the time limit for non EUMS has recently been extened from 90 days to 2 years but that 2 year countdown starts from when Residencia was issue which I suspect will catch some people out.

Red Eric

You are not required to register (and shouldn't do so) unless your stay is of more than 90 days.

If you're arriving fully intending to remain and make Portugal your home, there isn't any legal impediment to your registering earlier but some local authorities apparently might not effect a registration until after the 90 days - according to the regs, it must be done within the 30 days following that.

Moses2013

Even if you have plenty of cash to spend, certainly not a good idea if you are already saying you need time to look for somewhere else more suitable to your needs. You don't know the country, you don't know the market and every golf resort will be very different. It will really depend what type of person you are and depending on day, every establishment gets different types of ratings. Employees change, the condition of course changes and so on. There's a golf resort around 15 mins from our place in Spain and the 4 bed villas are advertised on their website (3 nights starting from €1938), so it looks like there is money to be made. But then again, I don't know how often they are actually rented out, what's the maintenance fee and how much were they sold for.........

MrBife

Beware of thinking that almost any property will generate much of an 'income' because in all likelihood covering costs and making a small surplus to put towards larger costs like repainting every few years or making small improvements is going to be the best you can achieve.

Most golfers I know prefer to stay in a hotel where they get a 'golf package' of included games, a bar to sit at, plus someone to serve them breakfast and make the beds - they tend to shy away from self catering. Hotels outside the summer holiday season give fantastic deals in order to keep occupancy up and keep the staff employed.

If you want year round income you may have to forget golf and head for the historic centre of one of the major cities, (Lisbon, Porto, Coimbra) but take note that your service costs are quite high (maid, meet/greet, electricity, water etc) and even there it's not all beer and skittles.

Andy43

Just on the rental point, we've had our PT house for over a year now and through a good management company we're getting a decent chunk taken off running costs/mortgage etc however I would agree with MrBife that a net income would be very hard to achieve - unless you're mortgage-free. Even then the return on investment would be way off the 7% you could achieve with traditional UK buy to lets or long term returns on stock market investments etc. Regardless of any income potential I'd do it again in a heartbeat however!
Golf - meh - not for me to be honest. I don't know the potential of inland golf rental vs close-to-beach or close-to-resort rentals but I would guess that you could possibly be restricting your market with a golf resort unless it's located near everything else the average holidaymakers want. We got lucky and found a place 500m from a stunning beach but a good 2km out from the Algarve town of Lagos and I'm convinced it's the easy beach access that's getting us business rather than anything else. As far as I know we haven't had any golfists stay yet - it's all families or groups wanting beach and town access.
Running costs on golf resorts may be higher too with condominium fees etc potentially being higher to keep the place looking green and inviting?
Don't believe anything you're told about any cast iron earning potential with golf resorts either - by their very nature they're businesses geared up to high pressure sales from our admittedly limited experience. A newly completed golf complex we viewed 18 months ago supposedly selling like hot cakes is still being advertised.

Moses2013

This is a very good point. As you say, many non golfers would prefer to stay away from the golf resort and MrBife mentioned that many golfers might also prefer the hotel. If I compare prices in our area there is a large 5 bed detached house for sale on the golf course (€799.000) and that's quite a bit inland. Just down the road smaller houses can be bought for 100K and 5 bed houses can be bought for 200-300K + they have private pools and no community fees.

sportpix

A five-bed house with pool for 300K?? I'm interested...

Moses2013

Sorry I meant Spain though, so wouldn't be relevant to you. I was just comparing prices in our area, PGA golf course vs. prices outside the resort. I would assume it is similar in Portugal depending on the golf course and you can maybe get a bigger return investing outside but close to the golf course. Even adding a pool later on might turn out cheaper, depending on planning permission.

Andy43

<goes to Rightmove Spain immediately>

sportpix

So I should be looking at Spain instead of Portugal...? Had some interesting discussions with people who know both countries well, and most preferred Portugal. I played golf with an Irishman on Monday who said it Portugal has the feel of the Irish countryside while Spain has the feel of Dublin...

Moses2013

Don't know about that and just depends on area within the country. I'm in the West of Ireland myself, so know the Irish countryside very well and we have a holiday home in Spain "It certainly doesn't feel like Dublin" .
Every area will offer different things and I doubt the guy has ever seen the whole of Spain and Portugal is probably only the drive from his hotel to the golf course. This is only around our area and certainly not like Dublin. Galicia would probably be more like the Irish countryside.

orangeblossom

I can't contribute anything on golf developments but I have been renting my place for five years and though it is 15 mins from a golf course haven't had any people who came on golfing holidays as far as I know.

I concur that making a profit on renting out property is not easy. I have covered my running costs over the five years but have made only small profits in two years and losses in the others. I haven't really made any contribution to my mortgage at all. The property was bought with the proceeds of rental flat in the UK and my income from this one, although it is considerably larger, is much less. I'm not too bothered because I didn't choose my flat for investment purposes I chose it for where I would be happy living. My flat isn't rented the whole year but until now I have advertised it for the whole year and rarely blocked off dates when it was unavailable. I just arrange my trips for periods when I don't have bookings.

I could make more money from it but if was going to invest somewhere to make a profit I would definitely have chosen somewhere with easy beach access (I'm only 3km away but you need to take a ferry to the beach) and or a pool, prefarably both. I chose not to because I want to live amongst the Portuguese not in a largely expat enclave but that is through choice not profit incentive. I also bought a 3 bed flat so I could accomodate family but you can make more money with smaller places, especially in the winter when alot of couples travel on their own, who don't want to pay for a 3 bed.

One other reason it's difficult to make profit in the early years is that the simplified Portuguese tax system on Alojomento Local properties taxes on a percentage of your gross turnover not on profit and my PT accountant insists that I invoice gross sums including fees that the cients pay to the site I advertise on, even though that money never was destined to come to me and the site insists it is not taxable. When I was having to make renovations and when I have had to renew appliances and furniture I wasn't able to deduct these on the simplified tax system, so my UK taxes were showing a loss but I was paying money in PT, add to that having to share costs of a drains repair in the building and painting it have further eaten into any profits. As was said by someone else, I don't regret my purchase but if you are buying a propertywith a view to renting it out in the future, you need to think differently. Today I went to a place a few kilometers away which is right near the sea and is much more toursity. I noticed lots of flats for sale. Maybe not as many as when I bought a few years ago, but really a lot. Is that because of Brexit? I don't know.

GeniB

I do think its best if you actually visit first Sportpix. The golf courses in the Algarve are mainly situated along the coast .. altho some are inland. We have been here for 10 yrs and have played golf at very many of them. I would say at any one time at least 90% of the villas and apartments are empty . I would not say they were a good bet for renting with a view to a steady income. Added to that ,several are building even more apartments to add to the ones already there. More competition .
In general holiday makers coming here want a sea view. If thats not possible its a mountain view ,or a good countryside view. Or if with young children a good complex with pools etc. Popular towns and villages are also good bets. Lagos is now the second most popular place to visit in Portugal,outside of Lisbon.. All the coastal villages are high on the list as well,. I would say the LAST place people usually want ..is a golf course

sportpix

Some very good intel here, for which I thank you. Seems like we should avoid golf clubs in favour of the coast. Actually most golf clubs in China - the ones that have not been shut down by the government for building on land that was not supposed to be used for such purpose, are property developments and most of the houses stand empty and in many cases, crumbling. Many were bought simply to wash dirty money so the owners never planned to live in them anyway. The comments above correctly point out that you can still have a golf holiday without staying at a golf club. Information regarding tax is a bit of a concern as we have spent the past three decades living in a location with ultra low tax. Being self employed I only get taxed on what I earn in HK, however most of my work is carried out outside of HK and so is not liable for tax. Actually that was before the corona virus brought havoc to our shores as my work scheduled for this month and next has been cancelled. Can't be taxed on what you don't earn...