Stephen Anderson, Managing Director of Portugal property experts Infinito Real, says that the coming weeks will be significant in determining exactly whether the summer has fared as successful as many had hoped, but says it has already helped generate greater interest.
It has been suggested that by 2012, Portugal will be making its way out of the slump and by 2015 will be completely recovered and seeing growth once more.
Stephen Anderson says:
“Whilst suggesting that growth could be some three years away sounds daunting, this is probably a realistic target for nationwide recovery.”
However, areas such as the Algarve are already leading the way in turning the tables as property prices have fallen the least in this region, according to the RICS survey.
It is hoped that a bumper summer of tourists, who flocked to Portugal for a cheap holiday amid the economic crises, will have generated fresh appeal to holidaymakers looking for a second property.
Stephen adds:
“We have seen a marked improvement of interest in purchasing property in Portugal off the back of a busy summer. The greatest problem for us at the moment is finance and therefore cash buyers really are the purchasers in the driving seat.
"With that said, agents must carefully manage the expectations of investors who still believe that asking prices are just a figure to be heavily negotiated - discounts of up to twenty and thirty percent are simply not available, as these prices are already discounted by at least this amount, although some movement can be negotiated.
"The next few weeks will determine whether the summer has helped the market turn a corner.”
Unlike Spain and some other countries, oversupply is not an issue in Portugal and as a result, there is not the number of repossessions that many eager investors believe.
Stephen concludes:
“Those repossessions that are available often have mortgages on them for more than what you would be able to buy the property for, and therefore the banks still have to get back that amount, which blocks them from being able to offer any greater discount.
“Significantly once the banks do start to lend again, the Algarve will be best positioned for a quick recovery, which provides a window for investors to make the most of property prices at the lowest they are likely to be, and a light at the end of the tunnel for those hoping to make a move in the future.”
