People from all around the world are in love with Portugal. Indeed, the country is often in the Top 15 world's leading tourist destinations. When it comes to real estate, foreigners represent 1 in 5 buyers in Portugal.
Among other nationalities, the French, the British, the Brazilians, the Germans, the Scandinavians, the North Americans and the Chinese, are fond of Portuguese real estate.
And COVID-19 is not changing this appetite. Indeed, more than 31 nationalities bought during the lockdown (PortugalResident.com).
Portugal is often cited as one of the safest European countries. According to the Global Peace Index (GPI), Portugal is the safest country in the EU and the third safest in the world after Iceland and New Zealand.
While everyone wants to be safe, this asset is even more important for some nationalities of foreign buyers. For instance, the Chinese are very keen on buying in countries where education is good, but also where the air is pure (air pollution in Shanghai and Beijing is world famous), and finally where there is no violence. Therefore, Portugal is in the short-list of countries attracting Chinese investors.
Its healthcare system is currently ranked 12th in the world and the country also has a well ranked education system with a high level of English-speaking citizens.
Portugal responded quickly to the pandemic and has a relatively low number of cases compared to other European countries. At the end of October 2020, 39 countries have had more deaths due to COVID-19 than Portugal, and the comparison with other Southern European countries is striking. Indeed, Italy, France and Spain have not been doing as well as Portugal.
Healthcare in Portugal is not only regarded as among the best in Europe but the pandemic has highlighted inadequacies in other countries. There have been increasing numbers of Golden Visa applications from the US and South Africa, countries which have seen their healthcare systems become overwhelmed during the crisis.
Those moving to popular expat regions such as The Algarve will also find it reassuring that almost every health professional speaks good English. Healthcare in Portugal is subsidised, and the National Health Service is available to all national residents. Private healthcare is also surprisingly affordable.
And of course, we must say that Portugal attracts many foreigners also because of its affordability, and sun. Indeed, the Cost of Living indexes always show that Portugal is a country where life is relatively cheap. Far from Switzerland, the United States, or Norway, that always top the rankings, being the most expensive countries to live in.
Finally, sun! For example, Faro -the Algarve’s administrative capital- counts over 300 days of sunshine in a year.
Figures available from Portugal’s Institute of Statistics (INE) shows that The Algarve overtook the Lisbon Metropolitan Area in terms of the total value of sales to foreigners in Portugal during 2019, at 37.7%. The equivalent figure in the Lisbon and surrounds was 35.8%.
Figures for the first half of 2020 suggest the trend will continue in this popular region. Agents are reporting increased demand for coastal properties from British and French buyers, as well as Spanish and Brazilian investors.
Also, data from Idealista reveals that 24% of searches made for properties in the Algarve come from international investors. Out of these, the most important nationalities are:
However this ranking by Idealista focuses on the nationalities that take the 1st position, therefore we should add some nationalities that are also very important, even if not occupying the 1st position:
Looking at Portugal as a whole, the French acquired the most properties (18.1% of the total value of the properties acquired by non-residents), followed by UK residents (17.3%).
The average value of properties sold to foreigners was €176,429, which is 50% more than the average value of properties sold to Portuguese people. In other words, foreigners buy more expensive properties than locals.
The Algarve has consistently been the most popular region among foreign buyers and, compared to some of Spain’s upmarket coastal areas, prices are fairly affordable. According to Idealista’s data, average property prices in the Algarve are comprised between €1,500 and €3,000 per square meter.
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Aside from its competitive property prices, other factors driving foreign demand in The Algarve include its beautiful scenery, pleasant climate, cultural benefits and low crime rate as well as the tax breaks and the ease of buying properties. The Algarve also has a number of major golf and beach resorts such as Quinta do Lago for those looking for an ‘all-in’ package.
With prices on The Algarve expected to fall slightly in the short term, the region looks set to continue being a property hotspot among foreign buyers looking to find a EU safe haven.
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