Sale of second homes returns to the Algarve bringing optimism

Foreign Investment from all over the world, and also Portugal, are causing an increase in home sales.

In 2014 they sold 20 per day. Take for example a couple who bought the home last year in the village of Carvoeiro for being "restful" with the garden view and the constant chirping of birds. "After a lifetime traveling the world, I value this peace and security," says Antonio Rigamonti, a retired textile multinational, which even led him to live in Guimarães in the 70s "My husband likes to play golf and this also already is our land, "adds his wife, Annaluisa. These Italians are also owners of large houses in Bergamo and Costa Smeralda (Sardinia), but it is in the Algarve they intend to spend most of the time. The couple Rigamonti is an example of the foreign legion seeking the Algarve for home purchase. A number that has been growing in recent years. Data from the Association of Professionals and Real Estate Companies of Portugal (APEMIP) state that in 2013 it sold 4,496 homes in the Algarve. And last year, when domestic buyers still showed caution for the purchase of a second home, English, French, German and a diversity of citizens of other nationalities continued to buy. In total, 7,350 homes were sold in 2014, an average rate of 20 per day and an increase of 63% over the previous year. The municipalities of Loulé (where Quinta do Lago and Vale de Lobo are located), Lagos and Albufeira are the areas that have greater demand. "There is a clear reversal in the market and the Algarve is again on the radar of investors, who are aware that there are still good opportunities in Portugal and that investment tends to value" guarantees Reinaldo Teixeira, president of real estate agency Garvetur, having recorded over one thousands transaction last year. Apartments, luxury villas, building plots, rustic houses or historical centers, everything is going in the Algarve, noting the lack of stocks in areas along the beach or the golf courses. "In the case of Vilamoura there is almost no supply, as in the center of Tavira," exemplifies the leader of Garvetur. "Prices are still attractive but the trend is that they will rise to previous levels, although not as quickly as in the past. I believe that we will get to the time when people return to buy on plans, because there is no enough supply built in the Algarve." Also Elsa Marques, owner of an agency in Olhão, felt the demand rise and recruited more staff: it began in late 2012 with three people and currently manages 10."What we sell the most are houses in the city, but also housing in the vicinity of Tavira." In addition to English, "the French are rapidly becoming our biggest buyers."

The French phenomenon

The British continue to lead, but in recent years the profile of home buyers in the Algarve expanded to include Brazilians, Angolans, Chinese, Swiss, Belgian and Swedish, in addition to the traditional German and Dutch. A real phenomenon are the French, "the market that was not a traditional buyer in the Algarve, helped a lot to recover and continues to buy, and it is expected to increase significantly in 2015," emphasizes Luís Lima, president of APEMIP. Fleeing the tax regime imposed by François Hollande, the French, according to Reinaldo Teixeira, "they like to buy typical houses from € 90 000 to retrieve the Baroque Algarve" in order to live in the countryside but are also homebuyers of Luxury properties worth several million euros. Also migrants are buying more homes in the Algarve and the Portuguese themselves, "who seeing their applications in banking becoming less and less valuable," and the housing is again seen as a profitable and safe investment. Banks also returned to open the credit tap and "in the case of its properties is achieving loans to value of 100%," says the president of Garvetur. The recover from the crisis began to be felt in the Algarve in 2013, but sales have skyrocketed especially in 2014 and continue to rise this year. As "the demand began," the Pestana Group restarted the real estate projects that were frozen. "We have projects in portfolio, which we stopped during the crisis and, thank God, we were not in stock," says Pedro Lopes, Pestana group administrator for the Algarve. In the resort of Carvoeiro, which has 550 homes already sold, the group to build  18 villas of the last phase of the village Vale da Pinta, between € 500,000 and € 1.2 million. "As we no longer have much product, we are doing resellers", says Sandra Matos, sales coordinator of the project, which notes the strong presence of Swedish "who are very rational buyers are taking stock investment." In Silves, where there is already a golf course, the Pestana Group will launch "a major new resort" that will total 250 apartments and villas, and an old tower Torralta in Alvor have for sale apartments T0 and T1 between € 65,000 and € 130 000, which is to be a hit with buyers of Portuguese. "We went back to the best years in the Algarve and buyers are returning, not the crazy amounts of the past but with reasonable investments," says Pedro Lopes. With demand rising, it is expected a new wave of construction. The movement of the cranes are already intense in Quinta do Lago, reflecting the interest of buyers to demolish houses and rebuild them in a different style.

Eye's on the 'new Vilamoura'

Expectations are high especially in Vilamoura, now purchased by the American Lone Star fund. "Clearly, the purpose of new buyers is to take a leap of development and speed up other operations in the Algarve", said Francisco Sottomayor, director of promotion of CBRE, which advised the sales process along with Neoturis. "The market was practically stopped in 2011 and 2012, prices reached 30% to 40% below the peak period and there began to be a lack of quality of built product," he notes Eduardo Abreu, the Neoturis consultant. And according to Sottomayor, "the decision to buy second homes is done always in the perspective of a good deal. From the moment in which people believe that the worst is over, the shift in the Algarve will be valued."

Translated  from imonews /curtesy of Expresso