Portugal as we reported some weeks ago is attracting a huge increase in tourism that will add much needed fuel to the Algarve property market in particular.
For anyone seeking an investment property in the sun, the Algarve has it all and at the moment there are still some bargain properties around to make this a real investment hot spot. It has been widely reported that the Portuguese government’s push to attract more tourists to its coastlines is already beginning to reap rewards.
As with most of the holiday hotspots in Europe, Portugal will be relying on its burgeoning tourist trade to fuel its recovery. With the economy stabilising now represents an excellent opportunity to inspect some of the bargains to be had while prices are low and conditions are set for growth.
According to Portugal’s national newspaper The Portugal News this week, Portugal recorded its best passenger figures in a decade as well as generating more money from tourism than ever before in the first half of 2011. Tourism is Portugal’s primary export, so this is excellent news for the country’s economic prospects in the long term. In June €660 million was spent by foreign tourists, which represents a major €28 million from June 2004. Surprisingly Brazilian tourists make up the bulk of tourists attracted to Portugal’s holiday resorts along with The British and French representing the global attractions of Portugal’s coastline.
Increasing tourism will no doubt push up prices in the long term particularly as oversupply of property isn’t an issue in Portugal as it is elsewhere. ‘Unlike in Spain and the US, oversupply is not an issue in Portugal. The official statistics show no evidence of over building prior to the economic downturn and new vendor instructions have been falling all year. Therefore, once the economy starts to recover, Portugal will not have to cope with the residential inventory issue that other countries face’, said RICS senior economist, Josh Miller in a bullish statement about the prospects for the Portugal property market.
A strong rental market is likely to be driven as much by domestic demand as it is by tourism. CI Spokesman, Ricardo Guimaraes said recently ‘Because of the difficulties buying a home at the moment, many families are instead turning to the rental market, which is experiencing a boost in activity’
