According to the annual study conducted by the real estate consultancy firm Knight Frank, Portugal has secured the ninth spot with a 3.8% probability of attracting international clients for real estate investments this year. Specifically, in Lisbon, the prices of luxury residences are anticipated to increase by 2.5%, surpassing the projected increments in cities such as New York, Paris, or London.
Portugal is emerging as a focal point for international investors eyeing luxury real estate. This revelation stems from ‘The Wealth Report’, an annual publication by Knight Frank, in partnership with the Portuguese real estate agency Quintela e Penalva, placing our nation at ninth place with a 3.8% likelihood of ultra-high-net-worth individuals (UHNWIs), those with a net worth exceeding $30 million, investing in luxury properties in 2024.
The study also reveals Portugal currently hosts 800 luxury property investors, with forecasts suggesting this figure could reach one thousand by 2028, marking a 25% growth. Alex Koch de Gooreynd, overseeing the Swiss, Austrian, and Portuguese markets at Knight Frank, commented to Jornal Económico (JE), “Portugal’s economic accessibility and stability have been instrumental in making it an attractive market, securing its position in the top 10. Given the political unrest in several nations, ultra-millionaires are increasingly seeking stable havens. Portugal fits the bill.”
This positive outlook is further supported by expectations of the European Central Bank (ECB) initiating rate reductions in the summer, coupled with Portugal’s tourism sector recovery, expected to draw more homeowners and investors towards secondary property purchases. As per the consultancy’s study, this scenario could lead to a 2.5% surge in luxury property prices in Lisbon in 2024, outperforming cities like New York (2%), Paris (2%), London (1%), and Los Angeles (1%). Globally, 22% of ultra-millionaires are contemplating property acquisitions this year.
Although acknowledging the escalating prices in Lisbon’s prime and central districts, the Knight Frank representative underscores anticipated growth in markets such as Cascais, Sintra, Estoril, alongside holiday destinations in central Algarve and Comporta, as well as Porto, which has seen steady growth in recent years.
In terms of transaction values for luxury properties, Alex Koch de Gooreynd explains they vary significantly based on location and segment, citing an average transaction price ranging between two and three million euros for Quintela e Penalva in the prime segment.
When asked about Portugal’s potential to further ascend in the global ranking, Alex Koch de Gooreynd highlights the need to assess the impact of abolishing the Non-Habitual Resident (NHR) regime on new investors in the millionaire and ultra-millionaire segments. “We are awaiting the new government’s decisions regarding potential measures,” he adds.
Furthermore, he notes that luxury investors come from diverse global regions, with the Algarve continuing to attract English, Irish, and Northern European investors, while Lisbon and Cascais witness growing interest from American and Brazilian investors. “We’ve also observed a demand among English clients for countryside residences or estates as alternatives to urban settings, particularly in the Douro and Alentejo regions,” concludes Alex Koch de Gooreynd.
