RENTAL POTENTIAL | Rental market
The sales market in Portugal may be in the doldrums, but the rental market is still strong. Anyone having difficulty trying to sell their second home in Portugal or, maybe just wanting the property to earn its keep, should look at renting out their property on either a long let or for holiday lets.
“ Over the last few years, the rental market has just got better and better” says Rob Kestholt of Silver Holidays- www. silverholidays. com.“ People, who would have spent around € 700,000 upwards on a property, but have decided not to buy, still love coming to Portugal. So they are choosing to take more luxurious holidays there and therefore rentals for the bigger, high end properties are booming”.
Many of the properties being let out are owned by people who either want to cover the running costs and maybe give themselves a little extra cash or, are trying but failing, to sell, so renting the property is a good financial alternative.“ Three years ago, we had 60 properties on our books. Then two years ago, this bumped up to 87” says Rob.“ Many of these came from owners we have previously sold to”.
Anyone thinking of buying an investment property, which they will rent out, should look at the top end of the market and ideally a four to five bedroom villa or three bedroom townhouse. The property must have its own pool, modern kitchens and bathrooms, air conditioning.“ People do not want anything less than they have back home. The property needs to be spot on in price and quality” he says. Properties which have Portuguese style bathrooms and kitchens are getting less and less booked.“ And I would definitely advise people not to buy a one or two bedroom apartment, as there are so many of those around at the moment” he adds. In August, the larger villas( which are always booked first) rent out from € 1,850 to € 3,500 a week. Townhouses with their own pool rent in the high season for around € 1,250 a month.
Algarve Accommodation Agency- www. algarveaccommodation. co. uk which is based in Lagos, has between 80 to 100 properties on its books at any one time, from one bedroom apartments up to a fabulous nine bedroom villa. In the high season, a small apartment would rent for € 350 a week and a nice four to five bedroom villa for around € 1,500 to € 1,750. Their main rental season is May to October.“ The most popular properties are the four bedroom villas, which always go first. People wanting an apartment often wait till nearer the time to book” says Jill Marsh, who founded the company.
Arcadia- www. arcadialuxuryvillas. com, which specialises in the top end of the market in the Algarve with the majority of its properties being in Quinta do Lago and Vale do Lobo, reports that the rental market was very strong in 2011 and is looking to carry on in that vein this year.“ The most popular rental is a four bedroom villa with pool and garden. We rent these out for between € 5,000 and € 9,000 per week” says Lisa Silva. Their busiest times are usually from the end of June to the end of August, but last year, she says, this extended to the 15th September.
One way to stretch out the weeks you can let a property is to put in pool heating.“ This can increase the rental season from May to the end of October” says Rob Kestholt.“ We persuaded a few of our clients to do that last year and it definitely made a difference”. He is also seeing an increase in groups of people coming over for three to four days out of season – March / April / May and September / October.“ This could be a group of men, who want to play golf or, women who come to Portugal for a spot of pampering, but they always tend to rent the bigger properties” he says.
So, all is not doom and gloom in sunny Portugal. If your property is in the right location, has a modern kitchen and bathrooms and all the mod cons, then think about renting it out and it should be able to earn its keep.
( For a selection of rental properties on the market see pages 54 & 55)
| www. portugal-life. net | Summer 2012 | 53