Portugal Off Plan Property Investment and Opportunities

8/14/2019 Portugal Off Plan Property Investment and Opportunities

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PORTUGALCOUNTRY OVERVIEW

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Portugalat a glance

GEttinG thErE

European airlines fy into Portugal

directly year round. Cheap fight

operators now run a daily service to

Lisbon and Faro rom the UK, with

prices starting rom around 130 return.

Airports: Lisbon, Porto, Faro

Flight timeLondon-Lisbon: 1hr 40minsLondon-Faro: 2hrs 40mins

Atlantic Ocean

Mediterranean

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portUGal at a GlancE

Area: 92,345km2

Climate: emperate

ime Zone: Same as the UK

Population: 10.3 million

Language: Portuguese

Capital city: Lisbon

Currency: Euro

Joined EU: 1986

Political system: Republican parliamentary

democracy

Winter averages: 58F

Summer averages: 82FDialing code: 00 351

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availabilitY oF MortGaGEs

Unlike some o the emerging Eastern European

markets, Portuguese mortgages are readily

available to overseas investors. All mortgages

are based on status, with proo o income and

outgoings required and the mortgage secured on

the property in Portugal. Tis means a smaller

initial outlay rom investors and better overall

returns or your investment.

planninG laws to stop

ovErdEvElopMEnt

A new planning law was introduced in 19931,

ollowing a rash o over-development. One o

the strictest planning laws in Europe, it has

been instrumental in preventing Portuguese

hotspots rom suering the same ate as the

overdeveloped Spanish Costas, allowing the

country to maintain its traditional eel and

atmosphere. It has restricted the number o

new-builds, which has and should continue to

orce property prices higher.

MassivE EU invEstMEnt in

inFrastrUctUrE

Between 2000 and 2006, the EU pumped 25

billion into Portugal to greatly improve the

countrys inrastructure. Roads and transport

links have been signicantly upgraded and in2008, construction will begin on a high speed

rail line, which will cut the 10-hour journey

rom Lisbon to Madrid to less than 3. Te EU

has pledged a urther 22.5 billion over the

next six years. Te equation is simple - when

inrastructure improves, property prices go up.

ExtrEMElY saFE invEstMEnt

location

As a location, Portugal meets all the criteria ora low risk investment. It has been a member o

the European Union since 1986, part o the

single currency since its inception in 2002,

has a stable government and enjoys steady

economic growth.

YEar roUnd rEntal rEtUrns

With its mild winter climate, cheap daily fights

rom all over Europe and an average o 300

days o sunshine per year, Portugal is a hugely

popular year-round destination. Its attractions

create a strong tourist demand, which ensures

investors can make solid rental returns rom

holiday-makers throughout the year.

priME toUrisM dEstination

Portugal remains a massive destination or

tourists. Te World ravel and ourism Council

orecasted this year alone that ravel and ourism

would contribute 30.6 billion to the economy,

growing to 53.5 billion by 20162

. ourism tothe country remains rock-solid, which means

strong demand or quality accommodation and

in turn, higher occupancy rates or investors.

On the westernedge o mainlandEurope, Portugal hasstunning landscapesand scenery. Nearly1,000 km o coastlineseparates the countrysinterior rom theAtlantic Ocean,aording visitorssome o Europesmost spectacular andpristine beaches.

Why Portugal?

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pErFEct holidaY or sEcond hoME

location - liFEstYlE

Portugal maintains a centuries-old tradition o service

and hospitality that has made it the perect destination or

visitors. A slower pace o lie, antastic leisure opportunities

and excellent living standards prompt many to invest in a

second home there.

capital Growth hotspot

Channel 4s A Place in the Sun has listed Portugal as the

third best overseas property option in its recent list o the

twenty best investment locations their research was based

on inormation provided by Price Waterhouse Cooper. Te

leading property programme cited a potential 360% return

or investors in Portugal over the next ten years3. Christina

Hippisley wrote, Te outlook or Portugal remains stable

which should mean steady capital gains or investors ready to

take a ten year view.4 Capital growth has remained consistentin Portugal at between 10-15% per year since 2000.

natUral bEaUtY

On the western edge o mainland Europe, Portugal has

stunning landscapes and scenery. Nearly 1000 kilometres o

coastline separates the countrys interior rom the Atlantic

Ocean, aording visitors some o Europes most spectacular

and pristine beaches. Nature reserves are dotted throughout

the countrys landscape and history enthusiasts marvel at the

traditional architecture. Portugal continues to attract visitors

in droves, which will place huge demand on the countrys

accommodation acilities.

1. Plano Regional de Ordenamento do Territorio Algarve/PROTAL

. http://www.wttc.org/006TSA/pd/1.Portugal.pd3. http://www.channel4.com/4homes/ontv/place_in_the_sun/0_make_money-4.html4. Portugal June-July 005 Capital Investment Christina Hippisley http://www.praia-del-rey.com/press/Portugal-Magazine



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Portugals Political Foundation

Portugal has been transormed in recent decades. Te

consolidation o democracy since the 1974 revolution, which overthrew the authoritarian dictator Marcelo

Caetano, and EU membership since 1986 has broughtPortugal into the European mainstream. In 1999 Portugal

was one o the rst countries to introduce the euro.

For over three decades now, Portugal has been a progressivedemocracy ounded on the rule o law and committed

to promoting ree enterprise. In Portugal, the right toownership o property is well protected. Te 1989 revision

o the constitution removed much o the remainingMarxist rhetoric o the original document and laid the

groundwork or urther privatization o nationalized rmsand the government-owned communications media. Te

1992 revision made the constitution compatible with theMaastricht treaty.

While Portugal has not historically played a leading role

within the EU, its six-month presidency o the Union inthe rst hal o 2000 and the high international prole

o the then prime minister, Antonio Guterres, enabled

the country temporarily to punch above its weight in

EU aairs. Te election o the ormer prime minister,Mr. Durao Barroso, to the presidency o the European

Commission in July 2004 could serve to raise Portugalsprole in the EU once more.

In 2006 Portugals voters chose a centre-right president

the rst since 1974. Anibal Cavaco Silva won over hal thevote, enough to deeat ve let-wing opponents without a

second round. Mr. Cavaco Silva was prime minister rom1985 to 1995, and is remembered or his determination

to embrace the market through privatisation, deregulationand investment boosted by aid rom the European

Union. His election bodes well or Portugals social andeconomic prosperity.

The Anglo-Portuguese Alliance betweenEngland (succeeded by the United Kingdom)and Portugal is the oldest alliance in the worldwhich is still in force. It was signed in 1373.



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potEntial capital GrowthAccording to leading property consultants, Hamptons International, prices on the SilverCoast are 25% cheaper than the Algarve and up to hal the price o a similar property

in Spain. Sao Martinho do Porto has become a weekend getaway or many people romnearby Lisbon. With the capital just 45 minutes south and linked by an excellent road

system, the Lisbon city-set has been snapping up second homes in the beautiul seasidevillage and pushing property prices up.

planninG rEstrictionsPlanning permission in Portugal is subject to strict controls in an attempt to avoid theoverdevelopment that has blighted other parts o Europe. Tereore, demand is high on

new developments, meaning prices rise accordingly.

natUral bEaUtYMuch o the Silver Coast remains raw and untouched compared to a lot o Portugalsmore developed areas. Here you can nd semi-deserted sand beaches and crystal-

clear Atlantic waters. In Sao Martinho do Porto, the cobbled streets o the older parto the village are lined with caes and traditional restaurants, while the searont is a

spectacular shell-shaped bay. Known as Concha or Conch Shell to the locals, it is oneo the warmest and most sheltered places to swim along the west coast, providing a sae

environment or amilies. Te appeal is obvious to the savvy investor - locations such asthis are becoming scarcer.

The searont o SaoMartinho do Portoon the Silver Coast isa spectacular shell-shaped bay. Known asConcha to the locals,it is one o the warmestand most shelteredplaces to swim alongthe Atlantic coast,providing a saeenvironment oramilies. The appeal isobvious to the savvy

investor - locationssuch as this arebecoming scarcer.

Why the Silver Coast?



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YEar roUnd Good cliMatE and stUnninG historical attractionsWhilst enjoying similar good sun and sea weather to the southern part o the country, the Silver Coast also oers tourists

cultural and historical buildings, monasteries, cathedrals, castles and ortresses that encourage year-round interest. Evenin winter, temperatures average around 16C, pleasant, temperate conditions or outdoor leisure activities.

iMprovEMEnts to inFrastrUctUrESao Martinho Do Porto is currently undergoing extensive urban improvements, including a new ully lit pedestrianbeach walkway and road along the entire stretch o the bay, and a panoramic lit that will link the lower part o the town

to the delightul old historic centre. Tese projects have been designed by Portuguese architect Goncalo Sousa Byrne andare expected to be nished by the end o 2007, prior to the completion o the development.

FUtUrE toUrisM dEstinationWhile the impact o tourism has not been as obvious on the Silver Coast as it has on the Algarve, the need to expandLisbons airport, an hour south, has been identied in anticipation o increasing passenger numbers in the uture.

550 million has been set aside to expand the existing acility, in preparation or a new 3.5 billion airport just 25kilometres rom Sao Martinho do Porto, which is set to realise an increase in passenger numbers. Te airport is due

or completion in 2017 and this huge increase in passenger numbers will result in a subsequent increase in demand orquality accommodation throughout the region.

Fantastic GolF coUrsEs and lEisUrE FacilitiEsFollowing in the ootsteps o the Algarve, developers along the Silver Coast have also begun constructing world class golcourses to cash in on Portugals lucrative sports tourism market. Already two international-standard 18-hole courses are

available to golng enthusiasts, with plans to build more over the next ew years. Tis should attract a slice o the countryssports tourism to the region, generating more revenue and uelling the need or quality tourist accommodation.

hiGh livinG standards bUt low cost oF livinGAs part o the EU, Portugal enjoys high living standards including excellent healthcare and education systems, yet it

remains one o the least expensive countries in western Europe. Daily items such as ood and wine are o excellent qualityand the cost o a meal or a amily o our is only around 35 per head.

EU propErtY at non-EU pricEsPrices are the same as some non-EU countries and over 50% less than coastal resorts in neighbouring Spain, leavingplenty o room or growth. Te emerging Eastern European markets are exciting, but not yet established, whereas

Portugal has been a member o the EU since 1986 and represents an ideal opportunity to diversiy into a very sae andstable economy.

5. Reerence source: (The Cut Price Coast Nigel Lewis, Daily Mail Friday April 9, 005). http://www.praia-del-rey.com/press/Daily-Mail-90405.pd.6. Reerence source:(Portugal Magazine 004) & http://www.ana.pt/portal/page/portal/ANA/PAGINA_CONTINUIDADE_IMPRENSA/?actualmenu=199430&IMP_

CT=183374&cboui=183374

Why the Silver Coast?



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alGarvE

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Te central Algarve (the area between Portimo, Albueira

and Vilamoura, see map), is very popular with tourists, andas a result o international demand has become a global,

somewhat crowded and, some say, overdeveloped destination.

In contrast, the eastern Algarve is noted or being real

Portugal. Te government has taken heed o the way the

central area has developed, and laws have been passed to

protect the eastern Algarve rom similar overdevelopment.

Tis means property, near the sea, is in very short supply.

toUrisM hotspot

Faro airport is the gateway to the Algarve, with 5 millionpassing through its doors in 2006. Te eastern Algarve has a

rich variety o tourism activity. Te area is blessed with historic

towns, such as avira, amous or its churches, cultural lie

and its Roman bridge. Beautiul sandy beaches stretch along

its coastline and there are plenty o rst-class gol courses.

Te area hosts a variety o events throughout the year rom

arts estivals to colourul traditional processions. Te recent

launch by the Algarve ourist Board (RA), o the Algarve

brand Allgarve means the prole o the region is going to

rise even more, backed with 6 million o investment 6. Allo this will maintain a high tourist demand, giving a positive

eect on property and holiday rental yields.

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natUral parK on thE doorstEp

Te eastern Algarve is home to the Parque Natural da RiaFormosa, amous or its coastal lagoons, lakes, wetlands,

dunes and beaches. Tis takes up 60km o the eastern

Algarves coastline, and has become a popular destination or

walking, wildlie watching and nding some o the Algarves

most untouched beaches.

ExcEllEnt location and inFrastrUctUrE

Investment in inrastructure in the last decade has paid

o with the eastern Algarve now linked to Spain by a

modern highway, the A22, which, in turn, links to the crossEuropean road network. Tis now makes it an ideal place or

a weekend holiday both or local and international visitors.

Te area also benets rom a warm climate.

Why eastern Algarve?

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Documents

Portugal Off Plan Property Investment and Opportunities