Investing in real estate is “protection against colonization” — idealista/news
THE real estate continues to be seen as “a safe haven” in times of emotion, and Portugal an attractive country for those who want to invest. Despite the pressure felt on the sector, due to the increase in interest rates, construction costs and compensation, a window was opened for the private capital, looking for opportunities in a “particularly attractive scenario given the scarcity of prime properties in the residential and commercial markets”, says Marta Espírito Santo, International Relations Manager at Quintela and Penalva | Knight Frank in an interview with idealista/news. For the person in charge, real estate is seen as a “protection against defense” and an advantage “due to the portfolio diversification benefits it offers”.
The most recently Wealth Report: Outlook to 2023 gives Quintela and Penalva | knight frank about how investment trends across all luxury sectors reveals that four in ten ultra-high net worth individuals (UHNWIs) increased their portfolio value in 2022, despite a ‘Permacrise’ year. And the stimulus was one of the ‘pilots’ of this performance, as well as the high immunity.
For 2023, it is expected that the sector will once again assume a leadership position, being at the top of the list of investment opportunities. AND Portugal will remain on the radar of investors. According to the study, our country – due, in particular, to the tranquility and safety that offers – is not Top 10 destinations for buying a home, along with the US, UK and Spain, which occupy the top three places, respectively.
Marta Espírito Santo referee there is high quality in the high and very high segments, and that the price/m2 in Portugal “is still very competitive for international investors who, for the most part, have their own capital”. In addition, as he explains, price “is not a determining factor”, since what this type of customer is looking for is an “opportunity or property which is scarce in the market”.
From the challenges to the opportunities, passing through the preferred and attractive areas of Portugal for foreign investors, to the typology of the most sought after assets/projects, the Head of International Relations at Quintela and Penalva | Knight Frank anticipates the behavior of the real estate sector for 2023, in this interview written for idealista/news.
According to the Wealth Report, “the pressure felt on the real estate sector, due to the increase in interest rates, created a window for private capital”. To what extent? What kind of opportunities are we talking about?
Indeed, the increase in interest rate was pointed out by 59% of care as an investor concern. However, the pressure caused by higher interest rates has created a window of opportunity for private capital looking for opportunities in a particularly attractive scenario in view of the protection of prime properties in the residential and commercial markets. Liquidity is back and real estate was the most cited opportunity (46% of those favored), either because it is considered as a hedge or protection against protection – ‘inflation hedge’ – or because of the portfolio diversification benefits it offers.
Portugal will continue to be on investors’ radar, say how the main ones studied. What kind of investors? And what nationalities?
Out of a total of around 40 countries, Portugal is in the top 10 with the US, UK, France, Spain. You Americans continue to be the ones who seek our country the most, but also some Europeans.
Liquidity is back and real estate was the most cited opportunity, either because it is considered as a hedge or protection against inheritance or because of the portfolio diversification benefits it offers.
These investors are looking for what kind of assets and/or projects? And at the same price level as in recent years, or do you expect some kind of discount?
The investor is a well-qualified client who knows our country. He knows exactly what he’s looking for and the areas where you want to live. We are talking about customers with a high financial involvement and who seek Portugal for the security and tranquility that our country offers. Price is not the determining factor as what this customer is looking for is an opportunity or a property that is scarce on the market.
And what are the preferred areas to invest in?
Lisbon continues to be a destination of choice, especially in the more central areas and for those looking to live in the capital, as well as all the way to Cascais and even Sintra, which are always highly sought after by families or clients who favor a less urban lifestyle. and more sport-oriented. The area that goes from Tróia to Melides is also very popular for those who want to recover a ruin on a hill or rehabilitate an old farm or simply have a summer house. while the harbor has been more attractive to investors who acquire a higher return.
The area that goes from Troia to Melides is also very popular for those who want to recover a ruin on a hill or rehabilitate an old farm or simply have a summer house.
What are the attractions of the country for foreigners? And the risks?
Our country has unique and differentiated characteristics. It is a small country, but it offers landscapes for all tastes. It’s safe and cost of living continues to be attractive.
In summary, how do you anticipate that the real estate sector will behave in 2023 in Portugal? What are the major challenges and opportunities?
The real estate sector is a resilient sector and one where solid investment opportunities exist. Rising interest rates will continue to hit some more indebted homeowners. However, there are liquidity in the high and very-high segments, on the one hand, and on the other, the price/m2 in Portugal is still very competitive for international investors, most of whom have equity.
Our market has completely changed in recent years and is now a diversified market that does not depend exclusively on the banking system. For Quintela e Penalva l Knight Frank, the challenge remains the same as always: accompany our customers in all their life cycles, presenting the best opportunities and solutions whether they are owners, buyers or investors.
The real estate sector is a resilient sector and one where solid investment opportunities exist.
In terms of the market and your business – what are the points to highlight?
AN Quintela and Penalva l Knight Frank is a 100% Portuguese brand with a strong position in the domestic market. The association with an international and reference brand such as Knight Frank, projected us in the international market and gave us access to a network in more than 50 countries. Our vision has always been to maintain our identity and to be able to serve customers globally, keeping the national market as our priority.
Finally, why is it that the real estate sector continues to be seen as “a safe haven in moments of emotion”?
Market specialists and financial analysts are following the investor trend towards a ‘back to basics’, that is, a return to fundamentals: tangible, direct and real investments. Real estate, especially in mature markets with high demand, is a safe investment.