AVOID BUYING LISBON REAL ESTATE - Top 5 Warning Signs Lisbon's Real Estate Bubble is Bursting!
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- čas přidán 16. 06. 2024
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Our Rich Journey - AVOID BUYING LISBON REAL ESTATE - Top 5 Alarming Signs Lisbon's Real Estate Bubble is Bursting: You've been asking, and it's time we expose the harsh truth about Lisbon's property market. With Portugal's recent political shake-ups and the fading away of once attractive investor and foreigner friendly incentives, the city is swamped with outrageously priced luxury apartments - we're talking over €1 million each in a country where citizens earn less than €1,000 a month! It's a blatant disconnect. Locals have been priced out of Lisbon. And it's just wrong! Lisbon's real estate is teetering on the edge of a full-blown crisis. We're tearing down the veil in this video, revealing the gritty and unsettling truths of what's really happening and the 5 signs the crash has already started. Fasten your seatbelts; this is going to be a no-holds-barred, eye-opening exposé that will leave you reeling!
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Yay to the Airbnb license restrictions and the golden visa incentives cut back. FINALLY! I hope the market finally corrects so Portuguese can actually afford homes again.
Agree
Fine for a few but what of the many of your neighbors about to be homeless? Who is really greedy then?
Not sure Portuguese are in the market for the kinds of homes associated with the GV. I doubt they will benefit much from the changes. They also won’t suffer much harm. The people who will be harmed will be those who bought properties marketed to overseas buyers, who will be left holding the soggy bag after what were effectively government price supports (GV, NHR) are withdrawn.
Totally agree
Houses are expensive because it's impossible to build new houses. Only in permit taxes it's 15000€ to build. 23% vat tax over building materials.
I was planning on moving to Portugal on D7, but after they announced NHR was getting cancelled I completely dropped the process.
Would love to see a video on finding off market cash deals in Portugal!
I wouldn’t be rushing in for now!
same!!
As a Portuguese I see what you are talking , but I do not agree fully, I can see house up from 600K and more yes comming down, but not to a cheap offer never, there arent as many as you think...investors and foreigners are not even 10% of the market, and people who own house of 500k or more they surelly have money to wait...2 or 3 maybe yes can lower but not that much.
then in the rest of Portugal maybe a little in Oporto maybe but almost nothing, and all the rest, yes sales are slow because everybody is not wanting to buy until they see it has stop rising interest rates. But I dont know if u are aware but the Goverment has put in place for 2 years mesures for people who have loans at high interest rate to post pone debt after 4 years and lower the interest rate on the present for everybody with high loans. So some will find it to lower their burden and keep going...and the most important even if more houses enter the selling market they are so needed that they will be taken fast because never up to now has so low the offer, that is why even with slow sales for over now 6 months nothing is happening to the prices, they are still in some places going up, but not going down, 1 year ago everybody was already saying we reached the top, but data is not showing that across the board, the rises are more moderate yes but i dont see it going down, I can even see it stagnating but with so less offer and still high deamand has People speocially the Portuguese their lives dont stop, they need houses so they are looking for sure and foreigners can find most of the places still good prices for them (expensive for the Portuguese that is for sure)
Obrigada and yes, Portugal is not only for nor populated by foreigners!!
Thanks for keeping us posted on these changes.
@Our Rich Journey
I am among those waiting to purchase a home in Lisbon because it is currently unaffordable, but it seems like prices are not decreasing. Even after being listed for several months, owners are not reducing the prices. Could you provide some statistics, such as the number of homes sold each month in the past few years, to illustrate the average price per square meter drop if possible? I truly appreciate the thorough presentation of information by both of you.
Thank you for your insight and perspective.
Thanks for consistently posting great videos! 🥳Yes please, for more real estate related content!😃
Great video. Thanks. Love you guys. 😊😊😊
would love to see a video on finding deals in a crashing market... in Lisbon specifically.
Yes, I would definately like to hear your take on buying real estate in a crashing market, please. Thank you.
Hi! Thanks so much for this info. How can you get a fixed rate mortgage in PT? Is it based on credit or is it more of a geographical thing?
Awesome content, as usual! 🥰🔥
Thanks for another great and informative video! Yes I'd love to see videos on buying property when the crash comes. I've been saving my money waiting for that.
I believe it also depends on the city, for example, central Portuguese cities such as Abrantes, Tomar, Santarém have still prices at the levels of 2019-2020. But I agree about Lisbon, Porto or even Algarve…
Would like to see you do a video on finding deals in a crashing market. Very curious about this. Thanks for the great content!
Many thanks for this video, I guess that would affect properties in biggest cities in Portugal but what do you think about farmlands which are also popular among foreign buyers, will they also follow this trend?
Very interesting 👌 thanks 🙏
Excellent video Team, thanks for the warning. 😊
Thanks Will!😀
@@OurRichJourney You're welcome. Thank you for your openess and honesty in your videos. I let the short commercials play, I hope it helps. $$$$
Another intelligent analysis thanks
I would love to see a video on laws related to housing you’ve learned since moving to Portugal!
Noted! Thanks for the video idea! 😀
@@OurRichJourney watching this video gave me the idea! 😅 so thank YOU
Thanks for the analysis. With all this said, would you think that Portugal is still sustainable for retirement?
Great info as usual! So what other cities in Europe are you hearing that are similar in cost of living (or cheaper) and real estate compared to Portugal?
Thanks for the info. , and Happy Thanksgiving, guys!🦃🍽🍽🍽🍽
please keep us posted on the lisbon RE market!
Definitely like the ideas for upcoming vids but I am curious. As an American we like sfr's or prefer stand alone living. Is it the same in Portugal or do residents prefer living close to others in condo/townhome situations.
Absolutely! Please more advice on cash buyer offer
Yes please I would like to see videos on purchasing real estate or leasing real estate with affordable pricing.
Thanks for the info! would love to see more videos on strategies for buying properties in cash in portugal as the market declines!
Checking in from the DMV.
Great Video. We live in Matoshinos and we feel the same way about the real estate in this area. I would love to hear a video on how to find good deals and offer cash. We said that another 2 years possibly.
Great video! What are your thoughts on Madeira? Do you think it is heading the same way?
Would love to see a video about the Porto market too! ❤
Thank you for this Real Time Intel on Lisbon R/E. I'm just curiousis the Algarve R/E Market going in the same direction ?
I would love to learn more about how to find those good deals. Thanks
I think is a great idea to have a video talking about the opportunities to buy during crash market. I love your videos
Very informative
Glad you think so!
I would love a strategy video! ❤
Hi
This analysis sounds right. What are your thoughts on the algarve?
We are considering a long-term rental in the Algarve. Do you have any suggestions for finding the best deals?
I would be happy to see video about possibility of housing crash on Madeira and Porto 🙏 and video how to make good deals in a market crash as well
The interest rates are at the peak and there is not many new construction (in the last 10 to 15 years it has been at historical low levels). So overall I believe old construction (and top of the range due to GV and RNH) might go down in price, the new construction is a different story. Banks are solvent and supportive of mortgage renegotiation and there is no alternative for people (most have long loans already - low LTV and a change would be costly) so I believe the market will rather go flat or face a small decrease instead of crash. I do not fully agree with the analysis (might be wrong thought)
There's really no incentive for the banks to renegotiate. They have insurance on the loans and will be paid out if someone doesn't make payments. And then they can just resell the property and repeat the cycle. It's definitely so in favor of the banks.
The flip side of ARMs are in a couple years when interest rates come back down, you'd be happy you had an ARM if you're starting at 4.5% and it drops to 2.5%.
What is your take on investing in following ETFs, TQQQ, SPXL, URTY, SOXL?
What about those who have existing property and were looking to put it up in the market for rentals? Is it a good idea to keep it?
Both of you are fantastic, thanks for this important information. Since you sold your house did you move back to Lisbon? Hope your girls are doing well. Should have bought my place in Lisbon 3 years ago.🤷🏽♀️………🤗🇨🇦
Would love more videos like that
Great video, I was planning to live in Portugal but once both incentives changed very quickly without any grandfather status, I thought never mind. The change towards both programs Golden visa and NHR has just been very disappointing but again it is their country so completely fine. I hope this opens the door to other countries. I'm not even sure if after my two years the NHR is fully cancelled and they change their minds about the 10 years grandfather status. It is all possible.
I had been planning on going D7 in Portugal.
And here I am working on residency in Ecuador. 😅
Same applies to the Algarve (plus water shortage on top). I watch prices constantly being reduced on idealista. SHTF ahead.
Yes! A lot of new construction in the Algarve is geared towards foreign buyers
Agreed.
I received my pre-approval letter to buy in Portugal in September. We stayed in Lagos Portugal looking for a property. We found interesting ones in Praia da Luz but when I went to the City Hall of Lagos and asked about the AL license they are not giving the license for apartment, Just for single family homes. I backed away from purchasing there because it wouldn’t make sense to buy without an AL license.
Amon and Christine.. Mastering "The Game". Playing those cards like TRUE VETERANS!
More on this topic 🙏
I agree with your thought process. Between interest rates, NHR and the policy compelling owners of abandoned buildings/or flats to fix or quit - the supply and demand ratio will change. The new construction that I've seen have signage 100% in English?!?!?! We know who they are trying to sell to but some folks will change their mind due to NHR... there are changes afoot 😉
For people looking to move to the country, it certainly would be nice if prices went down. But there also are a lot of portugal citizens struggling to find housing. I'd love to see the market cool off and for prices to drop to what they were a decade ago mostly for them.
I know a couple who went there last year September to November thinking of buying and retiring in Portugal came back, not this time. The prices have like you said increased exponentially.
Thank u
Wow that is sad ... ARM’s are never a good choice unless you have a short buy cash window down the road....might as well get a balloon loan .... 😔
Can you make a video on the restrictions that were placed on air BNB properties
I'm wondering if new laws will be put in place to stabilize the rents and mortgages.
I was speaking to a tax expert in Portugal the other week and they mentioned NHR ending but they also mentioned that there was so much uproar over it that reached the high levels of govt. and people said hey, we just won't live here anymore, we'll live in another European city like you mentioned. So they said they introduced a bill that will also be voted on at the end of this month that would only tax foreigners on 50% of their income up to $250k. So in other words: Let's say you make $200k working remote. If you were paying a 20% NHR tax (I believe it went from 10% to 20%, but correct me if I'm wrong), aside from SS taxes, you'd pay $40k in income tax. In the new system, you'd pay 48% on just $100k of that income, and nothing on the rest. But it's not a true 48% as its a progressive tax code, so it ends up being nearly identical of a number. The new proposal would only affect those making over $250k which puts you in the 1% of the world pretty much so you can probably afford to do many changes if necessary, or just deal with it and still live happy. They expect both proposals to pass (to get rid of NHR but also introduce this new system) but of course if only the former passes and not the latter, that would be huge. I am moving there regardless (kids start school next Sept) so hopefully you can touch on some of the expectations of the latter bill and it passing, and also, for someone like me who is probably buying around May/June, what are your suggestions for offers? Should we low ball knowing that 5 months down the road they will be fair or even high ball offers? Do enough sellers/realtors there realize this and should I feel comfortable knowing more inventory will keep coming up in more affordable prices? I've been tracking about 600 homes on idealista and I see 5-10% price drops happening all the time and houses staying on the market for 5+ months on the regular. I am wondering as someone who will be moving soon, what a good strategy is in a falling market, but as someone who does require housing (and not wanting to rent just to move again soon). Thank you! :)
Are you really putting your life, kids, in the hands of a country where you do not have the right to vote and you do not have any knowledge of the local culture? We don't even know whether EU will survive in the next year. Good luck with that.
You should low ball regardless, because it's different than in the US. We bought one property in cash and got it for 20% less (after offering 30% less) because we just shot super low (as it wasn't our primary residence and didn't have much to lose). In general, you can offer lower than you would feel comfortable doing in the US.
Do you have any link where we can read about the 50% up to 250k?
Would be fantastic to see a video where you discuss multi investors potentially buying apartment complexes with say 15/20 apartments
Can't agree more, my retirement plan has changed, Portugal is out of my list. So glad I did not act on the plan yet.
Portugal is incredibly expensive.
Naw won’t happen. You’ve been successful informing that living in Portugal have better quality of life. therefore those who are coming are not investors but looking for retirement or lower cost living. I bet most are purchasing cash, if they’ve sold prior home in the U.S or London and move to Lisbon. I myself might make the move looking towards purchasing, starting 500K in U.S cash. Like they say you reap what you sow.
I would love a video on how the Algarve and Silver Coast markets will likely be affected. I have been in Portugal for a year and was originally going to look to buy right away, but have paused my house search for exactly the reasons you talked about.
What about the immigration numbers Amon ? In Australia there's a shortage of supply due to high number of immigration this year 😞
My friend over the bridge said portugal is África with a Gucci belt 😂😂 amazing video!
???
Could you please explain?
Please do a vid on real estate in Porto - including best residential (not necessarily investment purpose) neighbourhoods.
Very interesting, and long overdue some would argue. I know your interest is not Madeira, but it would be great to hear your thoughts on Madeira, as i think it may be heading the same way?
Looove your videos! Now when this applies for Lisbon area, How about the country side??
The high variable interest rates alone is all you need to know. Sadly a lot of folks are going to lose their homes when the interest rates rise.
Australia has variable interest rate and fixed rate home loans. Our interest rates have increased so as an average home loan repayment has increased 50% since rate hikes began. Unfortunately the housing prices have only increased due to immigration policy to meet the worker demand and record low unemployment. Rental vacancies in my city are at 0.4%. Borrower distress is at an all time high but no crash in site yet.
Yes, please!
Yes please, I'd like to hear from you about making cash offers in a falling/crashing Lisbon housing market - there is nobody writing about this!
I love it! ' Sooo, the truth is....HAHAHA. Thanks for educating once again. As the saying goes 'Never try to catch a falling knife'. Thx and yes MORE please.💝💝💝💝Good 2 C U.
Adjusting the golden visa and NHR will help, but only so much. The real issue IMHO is that the requirements of the D7 and D8 visas to have a signed lease as a condition of the visa mean that people compete for apartments and feel they have to throw money at landlords just to win. I don’t see any changes that would affect this.
I couldn't agree more with this statement
Thank you!
Prices will not drop. The developers plan to sell those apartments to foreigners, not portuguese. And they are prepared to hold on to them for many years. Possibly even make them aparthotels and for rent only. I know that build for rent only is not common in Portugal, but it will be. The country is changing. Let's hope that it will at least bring rents down.
Golden visa and NHR just serves rich people, good houses in centre lisbon and Oporto will have corrections but, not too much, and there´s no new construction for medium salary buyers.
I'm in Portugal, vacationing. I was hoping you would have a meet up.
In 2008, while worlwide the markets were crashing, um Brazil It was rising. Now it's happening the opposit. Who bought then, are now paying the price. The same for the rental market. Please makes a video about this market in PT too.
I received the Idealista newsletter today, they state the prices in Lisbon have increased a few percent, but I see the same that good new properties are not selling, it will take a while for those to go down, and for the lotto seekers who are asking the jackpot for a T2 not remodelled from 80+ years will also try to wait as long as possible not wanting to realise that this dream is over.
Listen, as soon as I saw that more than 90% of the country has ARMs, I knew it was doomed (I'd been wondering why the Portuguese FED was barely raising interest rates meanwhile the US, specifically, was raising it every quarter.)
I tbh stopped my immigration plan to Portugal bc of this. Imagine being a couple years into your 5, and the country is going through a crazy recession 😩
Portugal has Euro, so they depend on the European Central Bank for rates.
This is unlikely to happen, its not like the US. Government has already put in place many restrictions on foreclosures as well support for the mortgage up to a certain level.
Great video. I am looking forward for new videos like that.
What about making video about cheap parts of Portugal. I hear that the Azores islands are very cheap if you want to rent.
I almost bought a property in Praia da Luz Algarve last month but decided not to because the AL license is not available anymore. It does not make any sense to pay the prices the sellers are asking without having an AL license. Prices needs to come down
A year ago I commented on this. This was never going to end well. A bunch of foreign money buying up houses and inflating housing costs for locals is never a good idea. As your wife said, long term rentals cannot justify the artificially high housing prices that were a result of mostly foreign money flooding in. Locals anywhere will be up in arms if this is not controlled and politicians react to voters, votes are their currency so they had do to something about it. Even the US , Canada and Australia have grappled with how to still maintain a free economy but also put brakes on too much Chinese money inflating housing prices. In some states like Florida and Texas they have simply said if you are Chinese and not an American citizen you cannot buy land or in some cases a house, so its all and good when foreign investors do what they do until locals get mad.
What other cities in Europe are affordable?
The elimination of the NHR will kill our plans on moving to Portugal. We are now considering other countries. (Mexico does not tax retirement income - not even at 10%). We were specifically interested in Madeira. Do you know if Madeira will also adopt the NHR restrictions?
Madeira is part of Portugal so they have no choice
Where investors are heading now in Europe?
Hi Amon and Christina, It would be interesting to hear from you on whether these recent or proposed changes in legislation are causing you to reassess living in Portugal in the medium to longer term.
I am from Canada and have migrated to Sao Jorge Azores, what are your thoughts on the Azores housing market/
I’m not sure if I believe there will be a crash and think this might be the new norm. Do you think it makes more sense to choose less populated cities in Portugal?
The prices are hugely inflated. The bubble will burst.
I have been investing in Less populated cities in Central Portugal and been doing great! Minimum 20% returns.
Has Portugal made changes in terms of an increase in healthcare costs and patient financial responsibility?
I live in Algarve at it seems that a lot of owners have started to change their stance on long rentals (most used to rent in AL regime), this move I believe to be national and will look to stabilise the market, there are a lot of owners in Algarve that live in Lisbon and would see the benefit of this, I wonder how the complexity unfolds at some point.
Latest I have seen, even if the NHR regime is ending soon, that would still be amortised by the rest of the tax benefits compared to any other european country that have adjusted for inflation, neighbouring Spain is seem to lead an influx of Spanish high net wort nationals, on top of the Ukrainians and Russians that are still flying armed conflicts in their countries.
These RE markets are certainly not on par to how markets work anywhere else in Europe, I would love to be able to be part of a RE mastermind trying to take advantage and at the same time help Portugal go through these times.
I got confused, so why did you just buy the apartment of last video ?
Portugal is over, unless a new government comes in and changes course.
All I hear poor local they are being price off the market.. glad government is cancelling programs
I'd like to see a video about what's going on in that clip of Christina in the hard hard on a construction site. I feel like you guys are always two, (or three), steps ahead. Building something that will profit in the coming climate?
Love the beautiful no make up look❤
Makes so much sense, Lisbon properties are even more expensive now than some apartments in Vienna, Munich and even Paris and even cost of living. Eating dinner in Vienna or Paris is cheaper than in Lisbon. Perfect storm for a real estate crash. To top it all no jobs to support such high COL.
Inflation is dropping, so in a few months, the European central bank's base rate will start to come down. There may be a correction but I do not think there will be a burst.
Over 90% with adjustable rate mortgages… wow! I wonder what it is in the US.
It's only 10% in the US. Portugal is a heavy outlier. There's very few countries that have more than 20% of their population w/ ARMs 🥴 I don't know what financial board looked at their numbers and thought it was okay.