This is the market report for the period from April to September 2005.
PROPERTY LISTINGS
As we have now come to expect, property listings have been fairly constant throughout this period, albeit during the peak summer period (August) less listings are completed. This is a combined result of many properties being occupied during this period, and staff holidays reducing our effectiveness. We also changed our company from a RE/MAX franchise to an independent agent during August, which was in itself a large amount of work.
What we have found interesting is the type of properties that are now being offered for sale. Offshore properties are coming back on to the market, and we believe this is because the offshore situation is now clear, and there are various options when selling/transferring this type of property. Our focus has been on what we predict are the strongest parts of the market, namely at the moment the middle-upper price ranges of properties.
PROPERTY SALES
Traditionally, the second half of the year is the busiest period for property sales and this has, so far, been the case this year. Once again, we are selling a wide variety of properties (ranging from a small plot of agricultural land to a newly constructed unique luxury villa). The only type of property we have not sold during this period is a commercial property, although we do have some sales expected for the final quarter of the year. We are also currently developing part of our business to concentrate on this part of the market.
We have seen an increase in sales, when compared to the same period in 2004. The majority of properties sold were villas/quintas.
Interestingly (and for the first time) sales of plots and land were the second most popular purchase. The lowest volume of sales was for apartments, although this may be as a result of our desire to concentrate on certain parts of the market. As predicted previously, sales are now occurring in the middle and higher end of the market. Both these sectors of the market are buyers markets and there are some excellent properties now available at reasonable prices.
With regards to the nationality of our buyers during this period, it was a mixture (as ever). Buyers from the UK dominated, but we are very pleased to report that Portuguese nationals were the second largest group of buyers. This was followed by Dutch and Canadian clients. In the first quarter of this year no sales at all were to Portuguese nationals, and we believe that confidence in the national market here is now increasing.
FINANCE
Euribor dropped during this period (to 2.125%) lowering the mortgage rate here in Portugal. Extremely low rates (from 0.375% above Euribor) are now available to residents and nationals. Rates as low as 0.75% above Euribor are available to non-residents, making finance in Portugal an attractive proposition for many foreign purchasers.Despite this, we saw a drop in the amount of properties financed here during this period (14% of properties sold as opposed to 29% in the previous quarter).
However, as before, in the case of purchasers who have not needed finance, the main reason for this is them using equity from their main residence (generally in other countries).Interestingly, all clients that have needed finance have opted to obtain finance here in Portugal.
PROPERTY ENQUIRIES
This has been a very busy period for property enquiries, and we have seen an increase compared to the first quarter of this year. We believe a large part of this increase can be attributed to our change of brand, and more flexible working approach, which has definitely improved our level of enquiries.
On our main English language website www.azul-properties.com there were 24,286 viewings of properties. During this period, there were 9,341 visitors to our website, meaning that each visitor, on average, viewed 2.6 properties. This average has reduced, meaning that we are having more visitors, viewing fewer properties.
Physical (walk in) and telephone enquiries have remained at a good level throughout this period.
We have made agreements with a number of international companies to make marketing partnerships, mainly using the Internet but in some cases also using traditional physical advertising. Local and international print campaigns are currently running, targeting two distinctly different areas of the market.
COMMENT AND EXPECTATIONS
Following a strong start to the year, sales have been steady, with the expected levels of viewings and sales. It is a good sign for the market that properties in the middle and upper sectors are now selling.As we have said before, we believe that we are at present experiencing a strengthening market, but still biased towards buyers. There are definitely excellent deals to be made at present, in all parts of the market.
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