Portugal: Investment Potential

Portugal: Investment Potential

Property investors in Portugal know that it is a massively popular year-round tourist destination, boasting a mild climate and a wide range of low-cost daily flights from all over Europe. Portugal's economy has benefited greatly from its membership of the European Union (EU) and it received funds of €25 billion between 2000 and 2006, with a further €22.5 billion coming its way over the next 6 years.

Infrastructure Improvements

Property investors in Portugal will be pleased to hear that the EU funds are being poured into infrastructure projects, such as improving roads and transport links. These include the construction of a high speed rail line, which will reduce the journey time between Madrid and Lisbon to less than 3 hours. In addition, the government has set aside €550 million for the expansion of Lisbon's International Airport, in anticipation of increased passenger arrivals. Lisbon's airport is already one of the largest airports in Southern Europe and plans are currently underway for an alternative location to cope with the massive expansion needed for the expected increase in tourist arrivals, which are expected to grow to 33 million by 2039. As any savvy property investor knows, as the quality of infrastructure improves along with tourist figures, property prices are set to increase.

Portugal Property Investment

Channel 4's ‘A Place in the Sun' programme has ranked Portugal third out of the 20 best property investment locations partly because the country is such a safe bet for investors. It's a favourite with the British who between them own some 50,000 properties in the popular Algarve region. Portugal's capital growth has remained at a consistent 10% to 15% year-on-year since 2000 with average property prices increasing by 17% during the period 2001 to 2006. 2007 showed healthy growth of 12% and Lisbon's rental market promises yields of 5.7%.

A stable economy, a solid tourism industry and strong price growth all combine to make Portugal the perfect property investment climate.