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Property Prices Forecast.
Property Prices Forecast.
Is there a reliable resource to find out how Propery Prices in the Algarve will move over the next 12 months?
I can tell you this, we bought an apartment nr Albufeira 3 years ago for 180keuros.
The next phase ( built ) are on the Market for 292k euros.
If we strip out " extras. inclusve tax etc " this still shows real growth of almost 40%.
A new 3bd villa ( small plot no pool ) in a residential ( not Tourist ) area of CVO has just sold for 450k euros. corner plot on main road as well.
With a real lack of land in the more popular areas of the Algarve it will take a global melt down to seriously affect the market.
The next phase ( built ) are on the Market for 292k euros.
If we strip out " extras. inclusve tax etc " this still shows real growth of almost 40%.
A new 3bd villa ( small plot no pool ) in a residential ( not Tourist ) area of CVO has just sold for 450k euros. corner plot on main road as well.
With a real lack of land in the more popular areas of the Algarve it will take a global melt down to seriously affect the market.
Look at the properties on carvoeiro .com real estate, most villas have been on for 9 months or more. Might be a bit different for apartments. In my view prices will stay the same for at least the next two years. Although with the latest news on people leaving the UK for other shores i am sure it will help lower priced eu countries. Anyway anyone want to buy my villa, i am waiting to further my worldwide adventures. 
Trapped in paradise? and loving every minute.
Trapped in paradise? and loving every minute.
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Gary/Gaynor
- CVO Legend
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- Joined: Fri Oct 15, 2004 12:44 pm
- Location: Carvoeiro
Overheating sees house price downturn in Europe
Last Updated: 1:07am BST 27/08/2007
Here is an article from the Telegraph yesterday
Basically house prices are now beginning to drop throughout Europe (probably anywhere in the world where pices went crazy) so would think Portugal will not be immune. My feelings is this is just the start of a big correction nothing goes up forever !!!
Hold tight
Gary
House prices in the overheated markets in Europe have begun a downturn , writes Ambrose Evans-Pritchard
House prices on the overheated fringes of Europe have begun to turn down sharply, replicating the early phase of the sub-prime property slide in the United States.
Housing booms in Romania, Bulgaria, Croatia, and even Russia are all looking stretched to extremes
Irish property has fallen for the past four months in a row as higher eurozone interest rates start to bite harder, while the speculative bubble in the Baltic states has burst.
House prices in the greater Riga region of Latvia fell 3.5pc in June, following a 1pc fall in May. Flats in the old city became more expensive than Berlin by early this year in a speculative frenzy, much of it with euro, Swiss franc, and yen mortgages that could prove disastrous if Latvia's currency is suddenly devalued - as may well happen, given the country's current account deficit has exploded to 26pc of GDP.
Similar booms in Romania, Bulgaria, Croatia, and even Russia are all looking stretched to extremes. Danske Bank has warned that much of Eastern Europe has been inflated by a "monster bubble" that recalls conditions in east Asia shortly before the crisis broke in 1997.
In Ireland, house prices dropped 2.6pc in first six months of the year to June, with falls of 3.3pc in Dublin. The slowdown is rapidly spilling across into building. House registrations are down 34pc over the first half. Roughly 15pc of housing stock lies empty, according to the Irish census.
Jean-Michel Six, chief Europe economist for Standard & Poor's, said extreme levels of household debt across large parts of Europe left the region vulnerable to tightening credit conditions. Debt levels are above 100pc of GDP in Ireland, Britain, Spain, the Netherlands, and Denmark.
advertisement"Spain is heading south. Local real estate companies have reported price falls on a quarter-to-quarter basis in Madrid and several other provinces," he said.
French property prices fell 1.5pc in July - though they were still up 5pc over the year. "House price inflation could turn negative in the second half of this year," he said, adding that proposals by President Nicolas Sarkozy to allow new buyers to offset part of their interest costs against tax would help support the market.
"The spate of interest rate rises by central banks is exacting its toll on disposable incomes already weighed by rising household indebtedness," he said. The European Central Bank has doubled rates from 2pc in December 2005 to 4pc.
The recent turmoil has pushed up the effective rate of borrowing even further in some countries.
Last Updated: 1:07am BST 27/08/2007
Here is an article from the Telegraph yesterday
Basically house prices are now beginning to drop throughout Europe (probably anywhere in the world where pices went crazy) so would think Portugal will not be immune. My feelings is this is just the start of a big correction nothing goes up forever !!!
Hold tight
Gary
House prices in the overheated markets in Europe have begun a downturn , writes Ambrose Evans-Pritchard
House prices on the overheated fringes of Europe have begun to turn down sharply, replicating the early phase of the sub-prime property slide in the United States.
Housing booms in Romania, Bulgaria, Croatia, and even Russia are all looking stretched to extremes
Irish property has fallen for the past four months in a row as higher eurozone interest rates start to bite harder, while the speculative bubble in the Baltic states has burst.
House prices in the greater Riga region of Latvia fell 3.5pc in June, following a 1pc fall in May. Flats in the old city became more expensive than Berlin by early this year in a speculative frenzy, much of it with euro, Swiss franc, and yen mortgages that could prove disastrous if Latvia's currency is suddenly devalued - as may well happen, given the country's current account deficit has exploded to 26pc of GDP.
Similar booms in Romania, Bulgaria, Croatia, and even Russia are all looking stretched to extremes. Danske Bank has warned that much of Eastern Europe has been inflated by a "monster bubble" that recalls conditions in east Asia shortly before the crisis broke in 1997.
In Ireland, house prices dropped 2.6pc in first six months of the year to June, with falls of 3.3pc in Dublin. The slowdown is rapidly spilling across into building. House registrations are down 34pc over the first half. Roughly 15pc of housing stock lies empty, according to the Irish census.
Jean-Michel Six, chief Europe economist for Standard & Poor's, said extreme levels of household debt across large parts of Europe left the region vulnerable to tightening credit conditions. Debt levels are above 100pc of GDP in Ireland, Britain, Spain, the Netherlands, and Denmark.
advertisement"Spain is heading south. Local real estate companies have reported price falls on a quarter-to-quarter basis in Madrid and several other provinces," he said.
French property prices fell 1.5pc in July - though they were still up 5pc over the year. "House price inflation could turn negative in the second half of this year," he said, adding that proposals by President Nicolas Sarkozy to allow new buyers to offset part of their interest costs against tax would help support the market.
"The spate of interest rate rises by central banks is exacting its toll on disposable incomes already weighed by rising household indebtedness," he said. The European Central Bank has doubled rates from 2pc in December 2005 to 4pc.
The recent turmoil has pushed up the effective rate of borrowing even further in some countries.
My prediction is that if you were to buy my 'extremely cheap for the area' house in Carvoeiro and spend a little money on it, it would rise in value considerably. 
House prices are still going up in the Algarve. Some places its a steady rise, some I've seen increase dramatically over the last few months.
A lot of it depends on the owners' valuations. You'll find in some areas, Carvoeiro included, people seem to think they can charge whatever they feel like and there are a great deal of overpriced properties. And the properties stay on the market for the next 2 years or more.
House prices are still going up in the Algarve. Some places its a steady rise, some I've seen increase dramatically over the last few months.
A lot of it depends on the owners' valuations. You'll find in some areas, Carvoeiro included, people seem to think they can charge whatever they feel like and there are a great deal of overpriced properties. And the properties stay on the market for the next 2 years or more.
Last edited by Misty on Tue Aug 28, 2007 5:15 pm, edited 1 time in total.
Think it varies from area to area. Hopefully Carvoeiro is still sufficiently "special" that values will hold. Don't think they would have built a resort like Monte Santo if they thought they wouldn't sell. We looked long and hard at the Algarve before we bought in Carvoeiro, and cound not find it's equivalent elsewhere. There maybe a temporary slowdown, but long term propery is still a good investment. The important thing is that it is long term.
You would be surprised how much the build without having a clue wether it would sell or not. Prime example - the next block of office space and appartments on the outbound road. There are thousands of available square meters of office space and a whole bunch of appartments that have not sold in Carvoeiro, but they built it anyway.Barry wrote:Don't think they would have built a resort like Monte Santo if they thought they wouldn't sell.
Setting aside any worries about wether the local infrastructure will even support new developments like Monte Santo, etc, I think it is highly unlikely that the developers worried about wether the units would sell or not when they started the project.
A more likely scenario would be, that the building gets the go-ahead regardless and will stagnate in the final phases while the developer tries to generate cash by selling the semi-finished units. This is probably due either to the build being more expensive than projected or they never had enough cash to begin with.
Wether the demand for new housing is enough to hold the value against the flood of properties being built is another matter. At present it would seem that the supply exceeds the demand and prices should suffer some correction.... but then again, people have been saying that for years now yet the prices refuse to budge.
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e-richard
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I agree with everything Gambrinus says above (well, yes OK it does happen occasionally 
).
But:
I suspect you mean asking prices and these two will diverge quite a bit in the forthcoming few years of over-development.
).But:
Do you mean asking prices or selling prices ?Gambrinus wrote:...yet the prices refuse to budge.
I suspect you mean asking prices and these two will diverge quite a bit in the forthcoming few years of over-development.
Still think there is money around. They have just built holiday homes on a lake near us in the UK and they are on the market for £750,000. Agree entirely with the location comment, since with a good location properties will sell even if elsewhere is quiet. Still believe that Carvoeiro is a location that remains very attractive to many people. To be honest I don't care that much since we are in to our villa for the long term. Always had that view regarding property, and have not lost out yet.
I think it would be sensible to buy where there is better value for money ie bigger better house for the same money, better value propertry can be found in central portugal away from the coast, even propertry around the lakes with lake frontage is still better value than some properties on the coast and its a nicer place to live away from the crowds of tourists.
A guide to living working and buying property in Central Portugal
www.gekkoportugal.com
A guide to living working and buying property in Central Portugal
www.gekkoportugal.com