Lisbon in Portugal is a city of many faces. Known as A Cidade das Sete Colinas (The City of Seven Hills), Rainha do Mar (Queen of the Sea) and A Cidade da Tolerância (The City of Tolerance), it is an intriguing destination that combines an old-world charm with a sleek modern offering.
From the chic shopping streets of the Chiado to the vibrant night life of the Bairro Alto, it is a city with delights hidden around every corner.
Lisbon’s history as a port is an important part of the city’s heritage and still offers a bustling trade today, with cruise ships, pleasure boats and goods vessels docking in the Queen of the Sea’s harbour from all over the world. At present, the dockside is humming with boats participating in the Volvo Ocean Race, ready for the In-Port Race on 6 June 2015, with the leg to Lorient starting the following day.
As well as sailing enthusiasts and tourists, Lisbon is increasingly on the radar of buy-to-let property investors, as Chris White, Founding Director of boutique estate agency Ideal Homes Portugal, revealed.
He said: “Lisbon has long been overlooked for its potential as a rental property investment destination, but the combination of price reductions, heightened demand and competitive yields has led to a surge in investment in the city, particularly among those looking for long-term buy-to-let investments.
“Investors are looking for modern apartment properties that are perfect for professional tenants. The market is all about the added extras right now, with upscale buy-to-let properties experiencing strong demand.”
White cites the example of the Ávila 81 apartments, on Avenida Duque d’Ávila. Located in an upmarket borough of the city, just steps from the Saldanha and the Jardim do Arco do Cego, the high end apartments are close to transport links and schools, as well as a host of retail outlets, restaurants and other amenities.
A typical four-bedroom contemporary apartment in the development offers a host of attractive modern essentials, including a home automation system, under-floor heating in the bathrooms, HVAC system chiller, whirlpools, mirror defrosters, LED lighting, natural stone in the kitchens and bathrooms and a high gloss kitchen complete with AEG appliances. Security doors and intrusion alarms also come as standard and all for under €1 million – prices start at €986,250 for a four bedroom property (and at €560,000 for a two bed).
Many buyers see now as the perfect time to look at Lisbon’s property market. After years of falling prices, values finally began to increase again in 2014 and have risen by 1.81 percent in the year to March 2015 according to data from Statistics Portugal (INE), with an average current price of €1,011 per sqm.
At the same time as prices are rising, the number of properties being built is falling. The Global Property Guide reported: “Dwelling completions continue to plunge in 2014, with completions down by 54 percent year-on-year to 9,429 units.”
With fewer properties on the market as a result, one can reasonably expect that heightened demand will serve to push prices up further. At the same time, the Global Property Guide is reported “moderate to good yields on Lisbon apartments, ranging up to 6.41 percent.”
The lowered prices and potential for healthy returns are drawing in property investors from around the globe.
According to a market report from JLL, foreign investment in Portugal’s property market rose from 45 percent in 2012 to a staggering 70 percent in 2013. Portugal’s tax benefits to foreign buyers are the icing on the cake: the Non-Habitual Residents scheme and the Golden Residence Permit make it an attractive investment destination for buyers both inside and outside of Europe.
