The demand for properties above 1 million euros continues to attract buyers. The number of transactions recorded in the first quarter of the year is already in line with the operations carried out in the years preceding the pandemic. The guarantee was given to Nascer do SOL by Patricia Barao, President of Residential JLL, stressing that this segment âhas been growing systematically since 2016 and despite the percentage of decline last year, due to the epidemiological situation, at the first quarter it is already posting values ââin line with the heaviness of the pre-Covid-19 years, which indicates the resilience of this sector. Looking at this scenario, he has no doubts: âThis year we will have one of the best years of all time. Demand is strong, the residential market has shown resilience during tests and it has been an exceptional year in line with the figures before Covid â.
Contrary to what is expected, the purchase of this type of property is dominated by local buyers. According to the manager’s calculations, during the first three months of the year, the domestic market accounted for more than 80% of sales made. But, taking into account the average percentage of sales, the weight of the national market is 60%, while the international market amounts to 40%. âWe 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, âexplains Patricia Barao.
But what is the secret of these transactions? The manager of JLL Residential explains: âThere is a strong demand for private properties where supply is scarce. Usually these are the unique apartments of a new project, penthouses, houses with special elements such as large outdoor spaces or private swimming pools that require greater demand, higher values ââand sometimes We have more than one client for the same property. Our journal recognizes that Portugal is consolidating itself more and more as an emerging country in Europe in real estate targeting a more exclusive audience. We were selling more properties at higher values ââthan in previous years.
Therefore, a large part of the offering is sold before it is even completed, i.e. in the factory. Actually a professional consultant. âWe believe the main reason there is factory sales potential is that there is added value for you when you buy at this point. There is a strong demand and little supply and the purchases in the factory arouse a great interest on the part of the national and foreign customers â, explains Patricia Barao.
An opinion shared by the president of the Association of Real Estate Professionals and Brokerage Companies in Portugal (APEMIP), which ensures that the fact that many projects are sold without completion is due to the confidence of investors and developers and, above all, anticipation of future value. âThere are investors who want to secure the purchase of a project – still under construction – both new construction and rehabilitation. In addition, everyone who buys the plant wants to be assured that it is a good long-term investment, âPaulo Chiado told Nascer do SOL.
But the âsecretsâ don’t end there. âA high-end market is characterized not only by the value of a property, but also by the features and services it offers. Whether for its unique or distinguished location, its views (river, sea or city), its leading architects, its high ceilings or its finishes above usual standards, its facilities for swimming pools, gardens, playgrounds, spas, gymnasiums, spaces for children and services such as deposit and / or concierge â, adds Patricia Barao (see page 55).
Still, the manager realized that the real estate sector was not indifferent to the effects of periods of confinement, despite all the resulting constraints and which 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 meets the challenges
While acknowledging that the pandemic has had an impact on the luxury market, as part of the clientele in this segment is foreign, and as such, they have seen their mobility stagnate for a long time, the head of APEMIP recognizes that “The luxury market has succeeded in meeting the challenges”, and specifies that “as soon as the vaccination prospects emerged, this segment regained its rhythm. The outlook is good, as people are still not moving as well as they were in 2018 and 2019. â
Paolo Cayaddo specifies, however, that it is rare to offer properties that have a very high value compared to others and “what happens is that investors absorb these properties with higher values”. But he leaves a caveat: “It doesn’t mean that the more expensive the property, the faster it will sell.”
For the manager, the outlook is 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. Faced with this scenario, there is no doubt: âThe trend is that 2021 will remain a year of significant growth for 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 boss of APEMIP, “the demand for housing slowed down in the initial phase of the epidemic, mainly due to the uncertainty that occurred”, however, he assures that “during the In recent months, it has been revitalized, proving that real estate value has a very strong component. People are more concerned about their real housing needs and, as a result, there has been an increase in the number of transactions. pandemic has also come to show that people are more demanding before buying a house, âhe told Nascer do SOL.
Paulo Chiado assures us that âinvesting in real estate in Portugal continues to be a good deal, especially considering the long-term marketâ. But let’s get 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 research office of APEMIP, â230,776 properties have been exchanged, indicating that only 19,520 properties (8.5%) were acquired by others. âResidents.
The race for a new job
âThere 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 specifies that âin addition, the factory purchase also allows access to progressive payment conditions, which is highly appreciated by the Portuguese “. Indeed, the official recognizes that “the Portuguese are dominant in all sectors, on the national real estate market” which “records very high levels of demand”.
For the official, there is no doubt: âThe housing market has shown strong resilience in the face of the pandemic, which has also caused new housing needs for the Portuguese. Given the conservative image of the Portuguese in terms of investment and with the increase in household savings levels, the residential market has become the main investment option.
As for the luxury market, Ricardo Sousa assures us that it âhas a very specific dynamism, and is inelastic to short-term dynamicsâ, whereas in terms of the traditional market, it is driven by low interest rates, a increased liquidity of the market, by the growth of new mortgage operations and the fact that 45% of Portuguese want to change housing due to the pandemic.
He added: âThese facts and indicators that we are recording in the real estate market give us the security of estimating that this trend will continue in 2022 and with the increase in family savings levels, the residential market has become the main option. investment. In our review.
MaxGroup, of the Remax group, reported that in the post-containment period there had been an increase in demand for luxury real estate by foreign buyers, ensuring that demand was spreading throughout Portuguese territory, even though Lisbon is the city of choice.
âTo live or invest, Lisbon remains a very attractive city and attracts more and more buyers from the most diverse countries. He specifies that these real estate clients are now placed in the luxury sector and that they see in Lisbon a set of factors that push them to make their purchase choice.
Among the selection criteria for foreigners is the price, “since Lisbon is still one of the European capitals with lower benchmarks than those of 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 stereotypes of the capital.
It is true that the world’s great fortunes are targeting the Portuguese real estate market and, more specifically, luxury homes. The conclusion comes from a study conducted by Al-Mazili which 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 certain countries that have a particular interest in luxury real estate in our country: the Spanish (11.7%) carry out the most real estate searches 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 mainly 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 interests for this luxury product are the Spaniards (13%), the North Americans (11.1%), the English (10.8%), the Brazilians (10.4%) and the French (7, 1%).
In the ranking of the six provinces that attract the most attention to high-ranking buyers is the region of Faro, with 28% of luxury surveys carried out by foreigners. The most popular nationalities 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 SetÃºbal 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. The Spaniards showed the most interest with 13.6% of visits. Next come the Brazilians (12.5%), the French (11.9%), the North Americans (11.2%) and the English (7.5%).
Fifth place goes to the island of Madeira, where 4% of luxury searches carried out by foreigners are concentrated in Portugal. The English (21.1%) and the Germans (20.9%) are the most active in research, 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 region of Braga with 2% of the polls. 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 %).
Click on the image below for more details.
Infographic for Oscar Rocha