Real Estate Investment in Portugal, a great opportunity - Eaglesinvestors

It is the perfect moment to find good Real Estate investment opportunity in Portugal. We are talking about ROIs that can reach up to 25% per year. Among many other reasons, the opening of Ryanair low-cost lines has made Portugal a great Real estate investment option. The reason being that tourism has exploded in Portugal, particularly in Lisbon.

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Most newspapers and economic journals announce the need to invest in Portugal, especially Lisbon. Everyone knows, there was the crisis that hit Portugal a great deal a few years ago. Real estate prices fell by 25% to 30% according to I.N.E. (Instituto Nacional de Estatística).

Ryanair opened the Paris-Lisbon line at the end of 2013, which resulted in tourism never seen before. Real estate investment has always been a great alternative to stock investment or any other financial investment type.

Tourism has increased from 10% to 20% a year for the last two years. The Lisbon City Council is investing a lot at this moment to make the city even more attractive.

Real Estate Investment in Portugal

Now, the Portuguese real estate market has turned the page of the dark years (from 2008 to 2013). The country “has become a destination for investment and international installations,” says Cécile Gonçalves, partner of the agency House in Portugal.

From 2008 to 2013, real estate prices had fallen by around 30%, before rising by nearly 7% last year. And activity also accelerated (+ 18% in 2016), under the effect of low mortgage rates.

The country is now out of the crisis and real estate prices are still more affordable than in Northern Europe. Due to this, the investors are logically looking for the rare find for a rental investment.

Given the growth of tourism in Portugal, it is better to opt for a seasonal rental. Especially since it is a country of owners (75% in 2016, according to Crédit Foncier).

Aiming for city centres:

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In Lisbon and Porto, Real Estate Investment is increasing among the French. They particularly like “properties close to the historic centre, in quiet places, or in the heart of the city,” says Cécile Gonçalves.

In the capital, count between 4.000 and 5.000 € per square meter for an apartment to renovate. There are apartments for any taste and style. You can find a two-bedroom apartment of 62 m2, renovated and located in a residence with pool.

It was sold for 275,000 € in the historic centre of the city. In Porto, with prices around 2,500 € per square meter, you can hope to obtain “profitability of 6 to 8% for seasonal rental or 4.5% for a lease on the longer term”. Analysis Francisco Xavier Esteves, director of the Barnes Agency in Portugal.

In the south, the Algarve region is also very popular with Real Estate investors. As an example, an individual who bought in Albufeira was able to afford a three-bedroom apartment in a residence with swimming pool and elevator, for only 220,000 €.

He would have spent 700,000 € for the same type of apartment, less equipped, in Bruges (Belgium).

But “beware of ghost towns during the winter”.

There are certain touristic cities that even though are a great location for Real Estate investments, seasonal renting might be a loss of money.

An example would be Algarve, warns Cécile Gonçalves, if you are betting on short-term do more research. Bet on cities like Faro or Albufeira, where the shops are open all year round. In these cities, real estate does not lose value at any time of the year.

The Atlantic coast of Portugal is seduced by its pleasant weather, and many other advantages: the quality of life, the sun, the sea, and security.

But most importantly, the warm welcome of the Portuguese, gastronomy, the rhythm of life … the list is long! We can easily understand why Portugal is such a great real estate investment location.

And at least, the country is indeed “a (not so) real tax haven”, insists Thibault de Saint Vincent, president of the Barnes network. Thus, foreign pensioners who settle there can enjoy a tax exemption on their pensions and most foreign investors often make use of Portugal’s “golden visa” scheme, by investing at least 500,000 euros in order to become eligible for residency (and eventually, citizenship).

Your turn now, book your ticket, invest and enjoy!

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