Luxury real estate in Portugal: a secure haven for investors

Contrary to expectations, the geopolitical and macroeconomic context has a positive impact on luxury real estate in Portugal. Many families see investing in this kind of real estate as a way to protect their income and savings from inflation, considering residential real estate as a “lifeline” in a possible crisis. This is according to Adriano Nogueira Pinto, coordinator of DS PRIVATE, who gives a positive overview of the sector. The market, he says, is stable and healthy and is seen as a “safe harbor”, especially for foreigners who are actively investing in this segment. He is confident that demand for luxury real estate in the country “will continue to grow in the near future.” Americans are here to stay - they are the most interested international investors in Portugal. They want to buy a house in luxury neighborhoods and use it as a permanent home for themselves and their family. The British, Germans and French are also active investors. The Portuguese are also active investors, although the most active “boom” occurred during the pandemic.

As expected, location and surroundings are still the main advantages of luxury real estate. And, of course, square footage, which must be “spacious”. Technology and smart home also play an important role, as well as security and energy efficiency. Urban centers such as Lisbon and Porto are still very attractive markets, but there is a “growing trend to shift demand to less urban areas, allowing homes to be larger and have pleasant outside spaces where you can combine leisure and work for different family members,” says the expert.

In this fully reproducible interview, the DS PRIVATE coordinator reviews and analyzes the behavior of luxury real estate in Portugal, predicting how the market for buying and selling this type of property will develop.

The Decisões e Soluções Group decided to invest in the luxury real estate segment during the pandemic, creating DS PRIVATE. What are the results of the activity so far? The creation of DS PRIVATE came naturally and out of a desire to create a specialized brand in this specific area - luxury real estate. The Decisões e Soluções Group has almost 20 years of successful experience in the Portuguese market, and all its brands emerge organically after we see demand from clients for a certain type of service. It was the same with DS PRIVATE - we realized that there was an interest in a certain type of property and decided to bet on a great service focused on clients with specific needs and requirements.

Many investors see this segment as a “safe harbor” for their economic resources and intend to continue investing. In these nearly two and a half years of operation, we are able to make a very positive balance of our performance and sustainable growth, both in store openings and in our real estate portfolio, as well as in the growing number of customers. The fact that we are in a segment that is not as exposed to economic cycles as other industries also helps us achieve these results. Many investors see this segment as a “safe harbor” for their economic resources and intend to continue investing.

How many agencies do you currently have? DS PRIVATE currently has 24 stores, both open and in the process of opening, all of which are strategically located. Our goal is to open at least eight more stores by the end of the year. We focus on personalized and quality service for our clients and want to be where they need us, which is why we aim to be distributed across the country, with a strong presence in major cities and areas characterized by high real estate values and demand for luxury properties. However, we want our services to be accessible to everyone looking for us, and for them to be able to easily reach us by visiting our physical office.

What are your goals for the coming years? Besides our aim to become a benchmark brand in the luxury real estate market, we hope that 2023 will mark our first step towards international expansion, with plans already in place to invest in opening stores in North, Central, and South America, Europe, and Dubai.

How is the market for buying and selling luxury real estate in Portugal developing? Transactions in the luxury real estate market continue to set impressive records, contrary to what was expected at the beginning of the pandemic. Although the luxury market did not suffer from the economic crisis, it was assumed that investors would be more cautious at this stage. However, the effect was quite the opposite: people began to value their homes more, and there was a noticeable increase in demand for real estate in urban centers from investors or clients with higher purchasing power. Wealthier families were looking for housing on the outskirts of Lisbon, Porto, and Coimbra, and there is a growing demand for properties in the countryside with larger spaces and pleasant outdoor areas.

Nevertheless, the greatest growth occurred as a result of foreign investments. Portugal has become very attractive for international investments, especially for American and Canadian investors. Our country is very appealing from a financial perspective, considering the commercial value of real estate, even in the luxury segment, and the attractive tax benefits that foreign investors can take advantage of. In addition to these reasons, our country is very appealing for living in terms of safety, climate, landscape, hospitality, and also has immense attractiveness for various countries, including in the fields of higher education and healthcare.

It can be said that Portugal is still a wonderful country for investment and that the luxury market is strong, in good shape, and recommended.

What types of real estate are in the highest demand? And where? The most sought-after properties are always new or renovated ones, where high-quality finishes combined with technology, such as smart home features, and excellent thermal and acoustic properties stand out and provide comfortable use and a sense of significance. On the other hand, in large cities, there is a preference for properties with excellent spaces and comfort conditions, such as green areas, swimming pools, and other outdoor amenities. We also note that many prefer to live in country houses, in some cases on the outskirts of large cities, due to the advantages of space and privacy.

Of course, the demand for large urban centers like Lisbon and Porto remains high. However, the pandemic has caused most people to reevaluate life in a home where they can work, leading to a need for housing that combines quality living with the ability for multiple family members to work and study without issues. There is a growing trend of shifting demand to less urban areas, where homes can be larger and have pleasant outdoor spaces that allow for a blend of relaxation and work for different family members. Portugal is a small country with excellent roads and great network coverage, which helps reduce distances, whether physical or digital.

What characteristics are most valued by buyers? When purchasing real estate, one of the most important criteria for investors is the location and surroundings of the property, especially when it comes to luxury real estate, where buyers seek a complete experience that includes the environment, accessibility, proximity to attractions, scenery, and neighborhood—all of these aspects influence their decision. Spacious areas are also highly valued, including kitchens and living spaces, in addition to separate rooms. Outdoor space is increasingly in demand among investors as well.

Safety and energy efficiency certification are also very important aspects for buyers who choose to live in residential complexes that offer constant monitoring and require information about the energy efficiency of the housing or building in which the property is located.

What is the most common investor profile? The majority of investors in this market segment are currently foreigners, with Americans being the most active investors in Portugal. The British, Germans, and French are also active buyers of luxury real estate in Portugal. Portuguese investors are also actively investing, but the largest "