Why a possible 'Brexit' isn't affecting Algarve Property Sales.
Almost a month after the mini political crisis following the unveiling of the so called ‘Panama Papers’ and more locally, the continued threat of ‘Brexit’ and further EU led Austerity Measures, Cerro Novo thought it the right time to team up again with economics writers from ‘Business Insider’ and ‘The Financial Times’ for their overview of the current situation.
It’s been about six weeks since we wrote our first piece on Brexit, and whilst some would comment that a British Exit from the EU is more likely than ever, the financial and FOREX markets are already beginning to settle having balanced their risks, on an either-way decision.
What is encouraging is that macro-economics experts are concentrating on many factors in the worldwide economy, which are actually protecting current owners and prospective Clients here in the Algarve. So why is this?
Firstly, we’re proud to know our market really well and have always focused upon the mid to luxury price range of homes. Properties from €150,000 to €3,000,000 make ideal second homes or permanent investments, and the Portuguese Government Strategies of ‘Non-Habitual Residency’ and ‘Golden Visa’ are still in place and very much aiding our continued success.
At present, there is little or no risk of the ‘drawbridge being pulled up’ on either of these growth programmes, whatever Great Britain decides on 23rd June. In addition, tax changes on investment properties in the UK and similar increases in taxation or tax compliance in some countries across the EU, means that wealthy investors (or those looking for a moderate return on investment) are looking to Cerro Novo (as a leading Algarve Estate Agency) to invest gains made from property investments closer to home. Whilst this doesn’t mean that the long-term rental market in Portugal is growing exponentially, it does mean that properties that offer home and income or year-round vacation rental possibilities are being sold quickly.
A good investor will always be looking for opportunities and we can help identify these, along with recommending fiscal advisors and property managers to help make the purchase and subsequent letting or tenancy both simple and efficient.
For those looking for a ‘lock and go’ home for family and friends, there seems to be no concern from Clients we’ve met over the past month. With price per M2 still well below northern European equivalents and the cost of living still pegged around 20% below these economies, the Algarve offers great value.
We all know the traditional Portuguese welcome is long-standing, and we’re pleased to reports is still very much alive and well, with the investment of foreign purchasers being supported by communities in towns and cities across the country.
In our opinion, is extremely unlikely that the Portuguese Government would ever incite punitive measures on a growing community of ex-patriates and second home-owners: in-fact there is now a greater focus on bilingual and remote access to services and systems across the country, so owning a property here is relatively straightforward.
Overall, whilst law-makers and politicians are involved, there will never be a clear or definitive answer as to reaction of any European country or economy regarding the threat of ‘Brexit’. What is for sure is that southern EU economies won’t want to lose the support or income from British expatriates or visitors, and will therefore continue the easy and safe transportation of people (and monies) whatever future we all wake up to on June 24th.
Buying a property abroad can be daunting and Cerro Novo are aware that owners and purchasers alike will be concerned by these political machinations, however we’re here to offer an independent view; supported by 35 years of experience in Portuguese Real Estate.
We look forward to welcoming you to the central Algarve.
With best wishes
Robert Edwards and Ana Penisga Amorim
Sales Director and Business Partner / Office Manager