Buying Algarve Property for Long-term Investment
For many people buying Algarve real estate as a long-term investment may be a daunting thought and most would be hesitant to consider this as a viable long-term investment.
Buying a property in another country can seem a complicated process especially when you do not speak the native language and are unsure of the process.
However, owning property has always had a steady historical track record and is not as volatile as other investments can be.
Also, we here at Gatehouse International Algarve with our network of professionals are here to help with every step in the process of purchasing your dream Algarve home.
Any investor who has not seriously considered buying property as a portfolio option should take a closer look at the benefits of owning Algarve property and why it could be the best option for a long-term investment strategy.
Our Top 3 Reasons to Invest
1. It can become a consistent source of income should you decide to rent.
Investing in property for the purpose of renting to either holidaymaker or on a long-term contract has the financial benefit of being able to show regular returns in the form of rental income. The process can be made much easier with the appointment of a suitable property management company to look after your property.
Compared to other long-term investments that require a certain level of patience in order to profit, real estate can eventually provide a large sum return when selling, while still providing financial benefits on a monthly basis through the rental payments.
With the average long-term rental cost of a decent 1 bedroom apartment valued at around €150,000 being around €1,200 per month, which can rise to around €1,200 per week during the high season as a holiday rental, the figures speak for themselves.
A very basic simulation based on those figures –
Property purchase price €148,000
Deposit @ 10% €14,800
Monthly repayments €636 per month over 30 yrs fixed at 4%
Monthly long-term rental €1,200 plus bills
So even with just a 10% deposit, you can see the potential of renting long-term.
*Simulation based on a similar property to the one above. For more simulations try using our Portuguese mortgage calculator.
2. A simple investment that most can participate in.
Many forms of investment require a certain amount of skill or familiarity, for instance, trading stocks and shares, in order for first-time investors to jump straight in with any level of financial confidence.
Buying property in Portugal is one investment that anyone with financial backing can enjoy, even those who are first-time buyers can use the knowledge that can be gained from family and friends who have already gone through the buying process.
The level of knowledge that’s required to invest in property can be gained with some simple investigating and learning about local areas that have increased in value over the last few years. Finding the kinds of properties that are popular and provide a good opportunity for both the rental and selling markets.
A real estate professional such as Gatehouse International Algarve can take the guesswork out of that information process and lead you in the right direction. Also, add valuable insights and provide their expertise to the process.
Algarve property – A great investment
3. Consider it to be a guaranteed retirement plan.
Saving for your retirement becomes harder to commit to as each year passes by. Money left in a savings account or an easy-to-sell investment plan can be accessed at any time, sometimes leaving very little when the time for your retirement arrives.
Buying Algarve property as a long-term retirement plan does at least require a level of commitment to your investment as does the upkeep of the property, however, this guarantees there will be something tangible to rely on when the time comes to sell.
While investing in Algarve real estate may seem daunting, especially when compared to other investment markets, it is recommended to consult with a professional before making any solid decisions.
A local Algarve real estate professional such as Gatehouse International Algarve who has a valuable level of local knowledge can help. With the information in relation to which areas would be the wisest to invest in at the current time.
Also, depending on how long in the future you are looking to sell and if you are thinking of renting the property to gain a monthly income. If you are interested in buying a property in the Algarve, contact us today for more information.
The managing Partner handles the property promotion and sales from the Almancil office which is also adjacent to the luxury coastal golf resorts of Vale do Lobo and Quinta do Lago. With over 25 years of experience in the Algarve property & financial markets.