Resort property boom in Algarve
The number of sales in resorts increased by 70 percent in 2021 compared to 2020.
According to the biannual report “Portuguese Resorts Market Report”, produced by the Portuguese Association of Residential Tourism and Resorts (APR), it was noted that, in terms of prices, this was one of the most significant increases since 2016, only surpassing by the 18.3 percent growth recorded at the end of 2018, when the Brexit agreement was approved.
“For a year and a half now, the prices of Resort property real estate in Portugal have shown signs of recovery and even in the period of a lockdown (1st half of 2021) they have risen +8.6 percent year-on-year”, stresses the report released by the APR.
The second half of 2021 marked the highest half-year increase ever, at 13 percent. Alongside the strong capital appreciation, sales at resorts also increased sharply, growing by 70 percent in 2021 compared to 2020 and exceeding 2019 activity by 30 percent.
Algarve resorts
In 2021, the average sale price of Properties in Portuguese resorts reached €4,205/m2, reaching a peak in the Albufeira/Loulé area, with sales reaching an average of €4,848/m2.
The executive director of the Portuguese Association of Residential Tourism and Resorts said these results “confirm the growing trend, which the pandemic has accentuated, of looking for housing in resorts in Portugal with outdoor space, privacy, security, connectivity, services of support and proximity to nature. This trend is visible through the growing demand by customers of the many different nationalities, including Portuguese”.
The real estate market in Portugal’s resort market is another one of the sectors with a strong performance in 2021, showing that the national residential market remains competitive and attractive in a transversal way, emerging strongly from the pandemic crisis.
International demand
The second year of the pandemic also brought important fluctuations in the structure of international demand for resort Properties in Portugal. Buyers from the United Kingdom remain the main source of demand in Albufeira-Loulé, generating 42 percent of purchases by foreigners in 2021, although this is a fall compared to previous years when their share exceeded 50 percent. This loss of share takes place in the context of more activity from other European countries, with emphasis on the Netherlands taking 12 percent of purchases by foreigners in this location, Ireland 9 percent, Germany, France, and Switzerland with shares of between 5 percent and 6 percent.
Higher prices
In 2021, resort-integrated housing available for sale in Portugal had an average value of €4,418/m2, reaching €8,374/m2 in the highest range of the market. In the main resort destination, the aforementioned Albufeira-Loulé, where 43 percent of the homes for sale are concentrated, the offer was placed at an average of €5,151/m2, and in the luxury segment, it reached €10,064/m2, a level never before seen in the resort market.