Algarve Property Market 2012 - Things are looking up Published on 07 May, 2012 by David Rowat / Google+
The economic crisis in the eurozone was appearing to be worsening until last October. As the financial markets took a hit, the crisis didn’t have any positive outlooks late last year. Politicians and banks were powerless as the economy took a dive.
This year, there have been significant changes, although small. In Britain, the FTSE 100 has begun to make a comeback since the lowest point in October of 2011. In addition, the economy in the United States is getting better, and European markets are improving as well. The problems in Greece also seem to have diminished, making way for guarded optimism for our global economy.
Throughout this downturn, the Algarve property market has taken a hit, but these economic improvements are allowing developers and agents to begin searching for new purchasers in the market. In spite of the high unemployment in the UK, the service industry, output of manufactured goods, and the confidence in business had all gotten better during early 2012.
Negative stories are the ones that reach the headlines, and while it is true the Portuguese economy must still make significant strides to get out of the woods, it is probable that it will follow the other international markets. As the United States and the UK’s economic troubles subside, it is a good predictor of interest in purchasing property in Algarve as the year continues.
It has indeed been a buyer’s market for property in Algarve, and purchasers have driven some hard bargains. As the market has experienced the downturn over the past four years, the market belonging to the buyer is not all bad news.
Sellers can’t have unrealistic expectations about their property’s value. Those desiring a quick sale must price their property accordingly; the lower price sells more quickly than the more expensive properties.
Don’t be mistaken and think that all properties within an area must have the same asking price. The owners who want a quick sale will reflect their desire to sell right away, while those who want a high return on investment are will to wait for the market to recover.
In addition to the sellers lowering prices to sell, the economic downturn has resulted in multiple repossessions and foreclosures when the loan isn’t paid. This brings a flood of new properties on the market. These properties are bank-owned, and often offer lucrative financing for those purchasing. This solution will not only benefit the bank itself, but should also propel the property market into a better position for sellers.
Even though spending has been down with the economic downturns, Algarve has continued to be one of the top destination vacation spots for Europeans, as well as holiday and retirement purchases. This is encouraging with the upswing in the housing market, since many Europeans already want to purchase property in Algarve.
2012 will continue to host buyers that want a lot of bang for their buck. Expect potential buyers to be looking not just at the price, but the amenities as well. There are many buyers who want a well equipped vacation home with a quality resort. There are some areas that host well maintained offices and resorts that are getting the first bites from new buyers as interest peaks again. Sellers should maximize their home’s value by ensuring that there is a full range of amenities for the potential buyers.
While most sales are currently being made to buyers with cash in hand, don’t hesitate to finance. There are many mortgages that finance up to 60% of the sale, and a few that finance even more. These are easily available even to purchasers who bring a large down payment to the sale. Financing is definitely worth considering to make the sale.
As the global economy continues to improve, people from around the world will begin to search for that perfect getaway for a vacation or retirement. Algarve properties have been hit with the recession, but in spite of the decrease in spending there is still a market for buying and selling a home in beautiful Algarve.
Published in Property for sale in Portugal