However, this is not what we are seeing here. Demand and sales volumes are higher than ever. It makes one think how these global trends once again are impacting us so little here in the Golden Triangle?
Perhaps it´s the weather, the golf, the dreamy beaches and the quality of life that has attracted so many people from all over the world to invest in this small paradise. Or is it the fact that Portugal is considered to be one of the very safest places to live on earth?
Perhaps it’s the favourable tax regime or the Golden Visa scheme that has attracted so many. There has been huge pent-up demand coming through following the lifting of pandemic-related travel restrictions. Buyers seeking a better quality of life and a new home away from home. Brexit might have contributed - many of our British buyers preferred to invest their pounds in the EU and reduce their currency risk.
The stats below speak for themselves:
Year-to-date, we at QP Savills, have agreed 72 sales, making it a record year following on from our previous record in 2021. Total sales volume sits just shy of 200 million euros.
Year on year we witnessed a 23% increase in enquiries.
Our resort offices in Quinta do Lago and Vale do Lobo have agreed 47 sales consisting of 162 million euros worth of property, making our average price per unit 3,463,000 euros.
Our country office, located in Loulé, has agreed 25 sales so far consisting of 33 million euros worth of property, making our average price per unit there 1,460,000 euros.
Interestingly, unlike the rest of Portugal, the vast majority of our buyers are still British and Irish which account for 71% of our total sales. They are followed by the French and Belgians, the Germans, and then the Portuguese who tend to buy more in the countryside.
This year total global wealth grew by 9.8% and there were 5,200,000 new millionaires. These High Net Worth Individuals are driving our market and seem unperturbed by the increasing interest rates, rather choosing to place their wealth in euros and Algarvian real estate. As with previous years, only a small percentage of our buyers required a mortgage, the vast majority being cash buyers. Many are digital nomads who are flocking to this sunniest region of Europe to invest in permanent homes rather than just holiday homes.
We continue to see an influx of younger families relocating here looking for a safe environment in which their children can grow. International schools are struggling to cope with the demand for places which has resulted in long waiting lists and some schools have doubled in size to accommodate demand.
There seems to be a strong preference for purchasing finished properties or those that need refurbishment over plots of land to build from scratch. This is probably because construction costs have increased considerably (official figures say there is a 12.5% increase nationally although this figure is likely higher) and the lengthy process of getting plans approved seems daunting for many.
Year after year we´ve witnessed an increase in the number of valuation appointments and an increase in properties coming to the market by around 10%. Some sellers prefer an off-market approach so we have access to more unofficial listings than before.
We’ve noticed stronger buyer interest in developments than ever before. The investment opportunity and the quest to “get in early” to benefit from future price uplifts are attractive. So much so that we are opening a new branch of the business:
QP Resorts and Developments, Consultancy, and Sales - will be run from our already rebranded offices located at the entrance of Vale do Lobo. Watch this space!
The Golden Visa programme is as popular as ever with more than 11,000 people applying since its inception in 2012. This equates to six billion euros worth of property sales. There is talk of the government making changes to the scheme and perhaps even ending it, so if you are interested in obtaining a Golden Visa then we would advise moving fast. We still have some options available here on the coast so do call one of our Special Agents for details.
The Non-Habitual Tax regime (NHR) continues to be hugely popular with over 11,000 non-habitual tax residents so far taking advantage of this attractive initiative for those looking to optimise their tax planning and reside in Portugal.
A new stream of demand is emerging with the arrival of the Americans who are coming to Portugal with their strong US dollars. In the States, Portugal is seen as being very trendy and perceived to have a lifestyle comparable to that of California and Florida. They have already found Porto and Lisbon and are now beginning to discover the Algarve. According to SEF (The Portuguese immigration office), over 7,000 Americans are now making Portugal their permanent home. Many from the west coast are choosing to relocate and consider the Algarve to be the ‘California of Europe’. The east coast Americans and Canadians migrate in the winter months to our temperate climate.
We have been a Savills associate for over 25 years now and our partnership continues to grow. It not only gives us access to their global network of over 700 offices but also insight into their global research.
According to the recent Savills Market Sentiment report, there seems to be a slowing of growth after the post-pandemic boom. Buyer sentiment seems to be one of caution due to the current uncertainty of the markets. It reports that an average of two-thirds of their buyers were searching for properties in resorts, coastal, or countryside locations, demonstrating that the search for space continues unabated. The past year has seen global property markets benefit significantly from the race for space and many government incentives designed to boost home sales. This activity has increased property values worldwide.
Here at QP, we’ve been extremely busy: we hired half a dozen more sales agents and admin staff to be able to maintain the standards of service that continue to make us your Best Sellers. We have big plans to expand our business and our team further as we are confident of continued growth, and have exciting ideas to grow geographically in key areas as well as into property management and rentals.
We are now 100% mobile ready, we have invested in a new innovative CRM system and have moved all our servers onto the cloud so that our Special Agents have access to all the data at the tip of their fingers. Our clients’ data is now safer than ever, and soon our clients will be able to access data about their property in real-time from when we send out their property details to feedback on viewings.
We have just launched a new marketing campaign in the USA and have meetings in LA early next year to strengthen our American network.
QP continues to actively cut down our carbon footprint by reducing our use of paper and progressively phasing out physical brochures to digital ones. We have invested in a fleet of new 100% electric vehicles so that we stay at the forefront not only of new technologies but also of environmental sustainability.
So, once again we here at QP have had another incredible year! As we write this on a sunny December afternoon, we are so grateful to all our agents, admin staff, buyers, sellers, and everyone else who have supported us over the past 25 years in making QP what it is today, the leading real estate agents in the Algarve. We live in paradise...still being discovered by the rest of the world. If you don’t already live here, give us a call.
For more information contact us on: Tel: (+351) 289 396 073