Foreign-buyer favorites Lisbon and the Algarve are Portugal’s property price growth hot spots, according to a report Tuesday from Property Market-Index.
Throughout the country, prices have jumped an average of 6.5% over the last 12 months. But in the Algarve—the southernmost region of Portugal known for its beaches and golf resorts—values have jumped up to 15% in the same time, the research firm said.
In capital city Lisbon, and its surrounding towns like Cascais, Comporta, Estoril and Sintra, properties “have also surged in value,” according to the report.
Portugal benefits from “the triple-whammy of international investment, regeneration and tax incentives for affluent expats,” the report said.
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One of those incentives, the country’s golden visa program—which helped drive international demand for a decade—ended earlier this month. It was shuttered over concerns that foreign buyers have driven up home prices and made buying property difficult for Portuguese citizens. However, experts have said that eliminating the visa program is unlikely to affect property values, Mansion Global reported earlier this year.
What is affecting prices though, is a lack of new construction failing to keep up with demand—recent data from the National Statistics Institute revealed housing stock was shrinking with 10 houses sold for every new one built between 2018 and 2022. In light of limited new development, Property Market-Index predicts home prices in many of these coveted areas will climb around 8.7% in 2024.
The Algarve’s Quinta do Lago ranked as the top property hot spot, based on factors including investment potential, cultural offerings, infrastructure and amenities.
The resort, located in the protected coastal lagoon of the Ria Formosa Natural Park, is home to affluent residents, an array of professional golf courses and known as the Beverly Hills of the Algarve.
Prices in the enclave have soared more than 28% since 2020 and are expected to rise another 19% by 2025, the report said.
This article originally appeared on Mansion Global.
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