Portugal Economy Boost By Tourism

Despite widespread news reports throughout 2010 that Portugal’s economy was heading for meltdown, recent figures have shown that the reality has been nowhere near as catastrophic as the media might suggest.

Indeed, with property prices in Portugal stabilising and a record number of tourists visiting the country in 2010, the signs look optimistic for anyone looking to buy property in Portugal.

Record number of tourists in 2010

Despite the global; economic crisis, the Bank of Portugal has recently revealed that the tourism industry was responsible for generating revenue of almost six billion Euros in the first nine months of 2010, well above the figures registered in 2009 or even 2008 – generally considered the best ever year for tourism in Portugal.

Stephen Anderson, a leading Portugal property expert, said: ”Going into 2010, the market was filled with uncertainty which was evident from the numbers of would be buyers who either postponed their viewing trips or who just came over to get a feel for what was happening without any firm decision to commit to a purchase.

“Of course, there are still deals to be had, but this is a small area and anything with a unique location will hold its value. Most reductions are in the mainstream apartments and villas, the ones with investment potential and the occasional one off villa that, although may be very nice, is not in one of those ‘never again’ locations.”

2011 likely to see a similar market

Stephen feels that things will not change dramatically in 2011, explaining, “It’s likely we will see more of the same, albeit with less drastic price reductions, as those most hit by the economic crisis have either sold up or walked away. Although prices will still be negotiable, there will be a more restrictive mortgage process hindering some of the previously available high loan to value deals.”

Mr Anderson also believes that a small bail out, if necessary, would not drastically affect property prices.  “Although, it will make financing a little more expensive as the [borrowing] rate will increase again, as well as some nominal increases in the stamp duty and IVA taxes.”

Find buy or sell property in Portugal at Homesgofast.com