Luxury real estate is living in dynamic times. And there are more and more nationalities interested in investing in Portugal.
The luxury real estate market is experiencing good times. Last year, the demand for luxury homes in Portugal continued to rise, extending to new nationalities, and the turnover grew, with several projects attracting the attention of those who invest – inside and outside. And the CEO of Christie’s Front Door, Rafael Ascenso, has no doubt that real estate will continue to be the “safest and most profitable” bet in 2023. He considers that “investing in real estate is a guarantee that money doesn’t depreciate”.
The premium real estate market is going full steam ahead, and the numbers leave no room for doubt, according to Christie’s Front Door Report Review 2022. The real estate company closed the year 2022 with a turnover volume of around 515 million euros, in a total of 416 properties transacted – this was, moreover, “the best year ever”, having been sold +15% units compared to 2021. The average sale price was 1.2 million euros, 25% more than the same period last year.
The Portuguese nationality continues to be the one that “most believes and invests in the real estate market”, according to data presented by the real estate agency in a meeting with journalists this Wednesday, February 1, 2023. National investors represented 55% of the deals done, from a total of 33 nationalities that were interested in the country. On the foreigners’ side, last year, Brazilian buyers stood out (17%), Russians (6%), Angolans (4%), but also North Americans (2%) – who in 2023 may also reinforce their position due to the appreciation of the dollar.
In terms of locations, the report indicates that in Cascais, the average sale price was around 1.9 million Euros. In this case, Portuguese investors represented 43% of the transactions, followed by Brazil (19%), Russia (10%) and the United Kingdom (4%). In Oeiras, the average transaction value was 697 thousand Euros, and in this municipality the Portuguese held a prominent place: they were responsible for 75% of the transactions, followed by Brazil (14%), Belgium (3%) and China (2%). In Lisbon, the average price was 991 thousand Euros – the Portuguese customers had a 49% weight, followed by Brazil (15%), Angola (8%) and France (7%).
Luxury Real Estate: what trends for 2023?
- Further” strengthening of the domestic customer
Christie’s Front Door recalls that the Portuguese continue to invest in real estate in the medium-high and high segment, and considers that this trend will be accentuated in 2023.
- Walkability and neighborhood experience
This is a trend that will continue to grow and influence the design of real estate projects. Customers increasingly value the concept of neighborhood, “where they can leave the car behind and go about their daily lives on foot”.
- Search outside major urban centers
Remote work and pandering have brought a new way of living, attracting many people out of urban centers where they can have larger properties with a connection to nature. Locations like Alentejo and Comporta will have more and more interested parties.
- Price stabilization, but not everywhere
Rafael Ascenso believes that the market will tend to stabilize in terms of prices and consolidate. “We have signs of that. We have some price stabilization, but everything varies from market to market. However, there is still a great shortage of supply, and because of this shortage, there are locations where values should continue to rise,” says the responsible.
How has the architecture in the houses changed?
Investors are looking for increasingly larger and less compartmentalized spaces. Duarte Pinto-Coelho, from the architecture office Fragmentos, one of the market specialists invited to debate the sector’s trends for 2023 during the mediator’s presentation of results, considers that “the needs are very different than they were a few years ago”. One wants, for example, a “more inclusive urbanism”, so that “people can circulate in the cities”.
The clients, both the promoters and the final client, he says, are “much more demanding”, which makes the projects have different characteristics, and there is a “very big investment in the concept part”. Besides, “the clients are younger than a few years ago, and therefore the generational issue also has a great impact on the design of the houses”. Rafael Ascenso adds that, in fact, the “reality has changed”. Today, he says, “houses worth 7 and 8 million are sold to people between 30 and 40 years old, not only foreigners, but also Portuguese”, something that didn’t happen so much in the past.
There is, for example, greater flexibility. “When we advise architects on the characteristics of a project, we don’t know at an early stage who we’re going to sell to. And so when we make a product we have to think about all markets. However, I can say that five years ago having an open kitchen in a 300 m2 four-bedroom apartment would have been unthinkable… there was a conservative mentality that is changing, especially in the case of the Portuguese,” says Rafael Ascenso. Also the exterior spaces have gained a special prominence, and there are even those who decide not to invest in a house for not having a terrace. “This is a big change in architecture,” according to the CEO of Christie’s Front Door.
Another of the important criteria in the design of projects is sustainability. It is nowadays a fundamental requirement, namely in terms of thermal comfort, according to architect Duarte Pinto-Coelho. And in this field, international clients are “much more demanding”. However, “innovation is difficult because it has brutal costs”, besides the “pressure that has existed on the value of construction versus the delay in launching projects”. “You want everything, but you can’t have everything,” he stresses.
