Market Report (2): Madeira and Algarve Gaining Popularity Among Germans and Others!

Madeira – Trend towards Sustainability 

Madeira, the southernmost area of Portuguese territory, is right on trend for purchasing a second home or holiday property! The island, located about six hundred kilometres off the North African coast, offers diverse landscapes and vegetation. The climate is mild throughout the year, with temperatures ranging from about 18 to 30 degrees. Funchal, the capital, provides all the culture and infrastructure one needs, while Madeira primarily offers tranquillity. Fans of nature experiences and outdoor activities on land and water find their paradise here. 

For property buyers, the focus is usually on the south coast, where about 95 percent of the approximately 250,000 islanders live. The north coast is also beautiful but rougher, cooler, and rainier. New holiday apartments in a suitable location on Madeira start from 300,000 euros. New villas in the southwest with a pool and sea view (three bedrooms, six hundred square meters of land) range from 700,000 to 1.3 million euros, depending on location and construction quality. Luxury villas in Funchal, Ajuda, or Garajau can cost up to three million euros. The highest square meter prices for properties on the island paid around Funchal. 

While good building land is becoming scarce, there has been growing new construction on Madeira since the pandemic. Luxury apartment buildings in Funchal´s neighbourhoods of São Martinho and Ajuda (4,000 to 6,000 euros per square meter), and on the southwest coast, various modernly designed villas are also under construction. 

In the pipeline is a project by a German property developer halfway between Funchal and the airport. Positioned in the luxury segment, with the German developer focusing on wellness, nature, sustainability, as well as innovative construction and technology. 

Algarve – Top Destination in the South 

The southernmost region on the mainland of Portugal remains the undisputed number one and the most popular destination for buyers of holiday properties with the highest real estate prices. The Algarve´s coastline stretches over 155 kilometres from the Guadiana border river to Cabo de São Vicente near Sagres. It is a diverse coast with the most varied beaches and coves imaginable. Those seeking tranquillity will find it here, as well as entertainment and sports activities. International flair and a complete tourist infrastructure are available. 

The backbone of the luxury market in the Algarve is the forty golf courses with their associated resorts. All are framed by a beautiful natural setting – either directly by the sea or in the mostly hilly hinterland. 

The most expensive area is the "Golden Triangle" between Vilamoura, Almancil, and the upscale resort Quinta do Lago. Three golf courses and 550 private villas spread out in the 800-hectare dream landscape of Quinta do Lago alone. Portugal´s highest-quality properties are found here, with prices of up to twenty million euros. This is home to the crème de la crème of the international elite and millionaires from around the world. Because here, they are among themselves and enjoy a sense of security and anonymity like hardly anywhere else in the world. 

Good houses with a pool are available in the Algarve from around 700,000 to 800,000 euros, depending on the location. For villas in exceptionally good locations, one must calculate at least 1.5 million euros. From 500,000 euros, there are houses of medium quality and properties in need of renovation. Good two-bedroom apartments in complexes with a pool are rarely below 300,000 euros

Author: Paulo Lopes