Most people seeking a home in the sun will have Portugal’s Algarve and Spain’s Costa del Sol in their sights. So which one is better value? JANE SLADE investigates
Comparing these two European destinations they would seem to be similar – each has a Roman and Moorish history, a great climate and laid-back lifestyle. There’s a wide variety of properties available in both the Costa del Sol and the Algarve; new builds, apartments, villas and traditional homes. But which of the two areas offers the better value?
The current 2014Q3 Eurostat House Price Index has Spain at 72.09 and Portugal at 90.64. Prices in Spain would appear to be the lowest in Europe, dropping by 28 per cent since 2010, but one should bear in mind that the sector was overpriced to begin with.
A look at the bank valuations of homes in the Algarve reveals that prices there are actually lower. Algarve specialist property portal Meravista.com, revealed last month that prices were were 1,223 €/m2 compared with SpainHouses.net’s reported average of 2,193 €/m2 in the Costa del Sol – making Costa del Sol – almost 80 per cent more expensive.
Meravista’s database of 22,000 Algarve listings and Spain’s Kyero property portal which has 200,000 Spanish listings, offers more insight into actual market values. Kyero’s Q4 2014 House Price Index shows that the average price for a house in Málaga (Costa del Sol) is €296,800 (£217,410). Meravista reported that 60 per cent of all houses in the Algarve are below €200,000 (£146,500).
An example of a home offered for sale by Meravista is this semi-detached, three bedroom villa built in 1999. It’s in a popular part of Olhão on an estate close to a village. It has an outdoor kitchen surrounded by a tropical garden and is on the market for €220,000 (£161,150).
For those looking to buy an investment property, the Algarve could also prove a better option than Spain.
The Eurostat HPI shows that Portuguese housing has steadily gained in price over the past three years while Spain is now slowing after a freefall.
Buyers in Spain also need to be aware that some 300,000 properties are currently under governmental confiscation due to them being built illegally on agricultural land or too close to the sea.
Meravista is offering this traditional two-bedroom Portuguese farmhouse (pictured below) in a secluded and quiet valley on the outskirts of São Brás, a rural region of white-washed villages half an hour from the coast. The house has spacious living areas and is surrounded by a mature garden. There’s a covered terrace and a swimming pool too, plus stabling for two to three horses. Priced at €225,000 (£164,820).
Of course when choosing a place to retire or relocate to, price is not the only factor to consider. Comparing the Algarve to the Costa del Sol, there are two obvious differences — the over-development of the Costa del Sol has inevitably impacted on its charm and culture.
By contrast the Algarve has more open space, rolling hills and unspoilt coastal plains which when combined with the Portuguese enthusiasm to preserve village life and traditions makes for a less congested landscape. However, the features and conveniences of the modern world can be found in the larger towns of Albufeira and Portimão.
This two bedroom, two bathroom villa (pictured above) with a swimming pool and ocean views is in a quiet residential area, just a short drive from the centre of Lagos, Palmares Golf and the beautiful Alvor lagoon.
It’s asking price has been reduced by €105,000 (£76,900) and is currently for sale at €280,000 (£205,110), so an ideal retirement property for those looking for a bargain.
The local lifestyle is undoubtedly a unique selling point in the Algarve too. The Government’s generous fiscal incentives, including a 10-year tax holiday for retired EU expats, and the Golden Visa scheme, which offers buyers from outside of the EU a residency permit in return for their investment, have also added to the appeal of moving to Portugal’s southern coast.
WARNING: It is advisable to use an independent solicitor when buying a home overseas and not one recommended by an agent.