In the 25 years that we have been involved in property here in the Algarve, we have never seen anything like it. It’s no longer just the Brits buying and not even just northern Europeans – it seems the world has discovered our little piece of paradise.

There is no need here to list all the many merits of life in the Algarve as you readers will of course know why we all chose to settle here. Suffice it to say that the Algarve and indeed Portugal have enjoyed worldwide press coverage over the past 5 years, be it tax advantages, Golden Visas, nominations for safest place to live, and, oh so much more.

Here is a quick resume of what’s happened just this first quarter of 2022 at QP compared to Q1 in 21 – the numbers are astonishing:

We’ve sold 28 properties so far this year, up 180% from 10 properties sold in the same period last year. We’ve received 44 offers so far, which is up by over 50% from 29 offers received last year and our total sales volume to date this year is at €88.5m up 386% from €18.2m in the same period last year!

It seems despite everything going on in the world right now the trend in investing in Portugal is continuing full speed ahead.

It is probably safe to say that the past 2 years have changed us all in some way and the local property market is of course not completely immune and has experienced shifts in what people are looking for and importantly how much they are willing to invest.

The lower and middle markets initially suffered during the pandemic. The level of demand did decrease as people’s financial situation made investing in property more difficult and even if they still could and would invest, the travel restrictions made viewing properties only possible virtually. And as the levels of transactions reduced so did prices and what vendors might accept. But post pandemic, this market has recovered so quickly due to the sudden unprecedented demand and the resulting lack of supply.

In 2020 and 2021, real estate has provided investors with an income opportunity as they search for returns in a low interest rate environment. Government stimuli in the wake of the pandemic has meant that there is more capital in the system and real estate is viewed as a safe store for it.

Demand for real estate here in the Algarve, particularly in the Prime market in which we have specialised continues to grow as we’ve seen with the figures above. New price highs have been recorded with values of over €10 million now no longer being a rarity. In 2021 we sold a truly magnificent single private home in Quinta do Lago for €18.5million. A record high for us at QP and indeed the country. Several more properties are now coming on the market at an even higher level, testament to the exceptional quality of properties which are now being created in the central Algarve and calibre of clients with whom we have the privilege of working.

In 2021, demand for property was still very much British-buyer led. Over 65% of our buyers come from the UK, followed by Portuguese and Irish nationals (both 15%) and then the French and many other nationalities in small numbers. The area is attracting a slightly more international group of buyers. AFPOP (the Association of Foreign Property Owners in Portugal) reports that in the past 12 months 34% of their new members come from the UK and surprisingly, 30% are from the USA.

In years gone by, the return on investment was key to many of our buyers. Opportunities to buy plots and projects for lucrative resale was what it was all about. Today buyers want beautiful homes they can move into and we attribute this to the new world we live in. The post pandemic work-place provides many of us with the opportunity to work from home and this is contributing to increased interest in bigger and better homes, somewhere buyers can spend more time comfortably. Many are moving here with families and the local schools are not only growing, but improving their facilities to cater to the most discerning of them. 65% of our buyers are hoping to spend more time in the country (min 4 to 6 months), 15% are buying for the occasional holiday and 20% of our buyers are buying to make Portugal their main home. So, a property, even one far away, could be less of a holiday home and more of a second home.

It is also interesting to see that few of our vendors are selling and taking their capital back to the UK or France etc., but almost all are reinvesting in one way or another in the local property market. This, added to the fact that many new big buyers are coming into the Algarve explains the phenomenal increase in demand for property, the lack of stock and increasing property values.

Many of our buyers are very familiar with the Algarve and have been travelling here for years. By the time they invest in property, they have familiarised themselves with all the advantages the area offers. A very important driving factor contributing to demand in the Algarve is personal security. The Algarve was recently nominated amongst the top 5 safest places to live in the world and the low crime levels are an important factor to purchasers. Investment security is the second most important driver and buyers perceive Portugal as a secure place to invest in a first or second home – houses are well constructed; infrastructure is good and the strength of the property market gives extra confidence to all buyers. And for those wanting to work from here, the all-important high speed fibre optic internet is the icing on the cake.

Most property searches at every level begin online. Our website had over 1.7m hits in 2021 and for Q1 of 2022, the hits are up 30% on the same period of 2021. Over 38% of our new buyers found us online and we are delighted to see that 35% of our buyers are repeat customers or client referrals.

Virtual viewings are thankfully a thing of the past. Serious buyers may enjoy a Facetime tour of a property or a virtual walkthrough before flying out but an in person property is certainly the norm at QP before buyers commit to a purchase.

The NHR and Golden Visa schemes continue to be a popular draw for buyers throughout the country. NHR buyers make up an estimated 20% and GV buyers account for 15%. We would suggest that this is much lower than the national average. Most of our buyers in the Prime market seem to have their ducks in a row on these fronts.

For those buyers who are unfamiliar with the Algarve, there is undoubtedly, initially some surprise regarding property prices, however, this inevitably recedes as those same buyers take stock of the prolific market activity and often missed opportunities whilst they watch from the side-lines before they embark on their own purchase.

So what’s going to happen on the Algarve property front?

There is a real lack of stock across the coast and at all price levels. We can clearly see that demand continues to increase and so our near to medium term forecast for the market is that values will continue to increase. New local planning laws (PDM) will be confirmed this year and we expect they will make it even harder to build new or redevelop old properties.

There is an enormous amount of investment from large funds wishing to invest and develop in the area. We are very proud to say that QP sold 90% of Marriott’s W Residences Algarve, developed by Nozul before the resort even completed construction. And there are many other exciting projects about to be launched. Vilamoura World, Conrad Algarve, Vale do Lobo, The Keys (now renamed One Green Way) just to name a few, have all recently been bought up and are in the process of being redeveloped and relaunched. The tendency is towards 5 star, all bells and whistles and the market will absorb these with glee! Exciting times ahead for all of us!

The benefits of NHR and GV, an excellent and affordable health care system, security in terms of personal and investment, the climate, the lifestyle and ease of access make this place hard to beat. Portugal is well and truly on the Global map. It’s a solid investment and trendy.

Our advice:

Developers should not delay in bringing new stock onto the market. Buyers, buy now or pay more on your next visit!

Led by our General Manger Jules Hamel and our sales director Jamie Robinson, our multi lingual, growing team of 23 like minded individuals are highly qualified and experienced and are here to help you achieve your desired results. We look forward to hearing from you.