What You Get for the Money

Don't let YouTube fool you...

I speak to a lot of Americans that are planning to move to Portugal. For some, the lower cost of living is a major consideration as they have limited retirement income. But some, unfortunately, seem to have unrealistic expectations when it comes to the cost of real estate. So today, I try to explain what you can expect to get for your money.

Attention: There are Caveats

Before we get too far into this, permit me to offer a few caveats:

1. I am not a real estate professional…though I love all things real estate.¹

2. This post is strictly related to the Vila Real de Santo Antonio area. While Algarve is more expensive than many rural parts of Portugal it is not Lisbon or Cascais. Also, all Algarve prices are not the same. There are significant differences between Sagres (in the west), Vilamoura (central), and VRSA (in the east).

3. Furthermore, I profile properties for sale. I do not discuss rentals in this post.

4. Finally, I am including the listed price only. As discussed before, we are not the best shoppers…so don’t ask me what the final negotiated price should be. You will likely pay too much!

With that out of the way, permit me to explain what I did. I toured 4 properties: one asking under €200,000, one for under €300,000, one for under €400,000, and one for around €500,000. Two are houses, two are apartments/condos in multi-story buildings. So let’s begin….

Large T5 with 3 baths.

Half a Mil

If you want to live a short drive from downtown, want 5 bedrooms/3 baths, a pool, and an oversized 2-car garage…this might be the place for you. It is situated on an old Quinta (farm)…where an enclave of luxury homes in “the country” has been built. Some are holiday homes for Portuguese like this one being sold by a recent widow. Many are owned by expat/immigrants. The enclave (approximately 100 homes) is situated 5 minutes from Castro Marim, 3 minutes from Praia Verde, and about 10 minutes from downtown VRSA. To get a cup of coffee, buy groceries, or get to the beach (praia) you will either have to get in a car or ride your bike. (The road to Castro Marim or the beach is lightly traveled but well maintained and will soon have a bike lane over 80% of it.)

This house is not my cup of tea…but it might be yours…different strokes. It is what I call “Portuguese modern”. It looks like a traditional Portuguese house on the outside. It has shutters over all the windows. The kitchen is in a separate room. The bathrooms are tiled floor to ceiling and have bidets. But in hopes of making it look like it was built in the last 20 years, it has a glass and stainless steel staircase.

In fact, it was built in 2003 and has an Energy Rating of C². The asking price is €545,000 and came on the market within the past month. If you are interested in more details, click here for the listing.

A center courtyard and rooftop decks.

Asking €328,500

You may recall me writing about walking to explore the “industrial area” of VRSA called Rua Angola. Well, there is a multi-story apartment complex overlooking this area that is very well maintained. I toured a 3 bedroom, 2.5 bath apartment on the first floor (which in the States would be the second floor) of this 5-story building. (The apartment overlooks Rua Angola, specifically a gym and ballet studio.) The complex and the apartment are clean, and well-maintained. The apartment is being sold furnished. The building was built in 2008 but only has an Energy Rating of D. However, the windows fronting the street are not only double-glazed but are actually two sets of double-glazed windows. We heard absolutely no street noise when in the apartment though I can’t promise the Feira da Praia would not be heard as it is just 2 blocks away.

The rooftop entertaining area overlooks the river. The “ruins” are the old fishery. One hopes they will be renovated in the future.

The building offers a common rooftop entertaining area with grills. The unit also includes a basement garage with one assigned parking space. So far, this is the nicest large apartment complex I have visited in VRSA.³ For example, the elevators in the building will accommodate 6 passengers with each opening to only two apartments. The entrance, common halls, center courtyard, and rooftop decks were immaculate. If you are looking for a modern apartment just 5 blocks from the center of town this may be the place for you.

A very traditional Portuguese apartment kitchen with a washing machine.

Parque Do Glória

There is a large apartment complex called Parque do Glória just 2 blocks from the apartment we currently rent. The buildings are not as “shiny” as the apartment we toured above. When you step inside expect a tight squeeze with only 3 people in the elevator⁴. At 100 square meters (about 1100 square feet) the rooms in these apartments are a bit smaller than the complex above. This complex houses a lot of families, so expect some noise. But with 3 bedrooms and 2 baths, this unit built in 2005 is €100,000 less, listed at €225,000 plus €43 monthly condo fee, and is also being sold furnished.

Our neighborhood offers plenty of free parking on the street, so there is no underground parking. And there is no rooftop deck to share with your neighbors. But walk 3 blocks and you are strolling along the river. Walk or bike 3 km (less than 2 miles) and you are lounging on the beach.

A 2 story fisherman’s cottage.

Looking for a Project

Finally, one block from the river is a small group of old fisherman cottages. They are located behind the area of VRSA I highlighted at the end of this post in which 10,000 square kilometers have been recently purchased. Some of these 70+-year-old cottages have grown up over time. The 2-story unit above is one of them, having been renovated in 1990. While it is inhabitable, it was a rental property up until last year, most people would say it “needs work”. For example, it does not have any heating or air conditioning. But the unit is not huge and one “split” on each floor would do the trick and could be purchased and installed for under €2000.

If it were mine, I would blast out a few walls to turn this 4-very small bedroom, 2 bathroom⁵ house into a 2/2. I would upgrade the electrical. While the kitchen is functional, I would replace all the appliances and reface the cabinets. I would eliminate one of the first-floor bathrooms and move it upstairs. I would update the remaining bath. I estimate if you acted as your own GC and didn’t go too crazy you could complete all renovations for about €50,000-60,000 in less than 6 months.

If you wanted to you could live in it, and do the work over time. EG: live on the first floor while you combine two of the small bedrooms on the second floor into one, and move a bathroom upstairs into the third bedroom. Then at least you would have a nice place to relax while tackling the downstairs which will be more difficult. We have done this sort of renovation in the States. It is stressful, yes…you can’t keep all the dust in one place…but it is doable.

The asking price is currently €180,000, but given the work required I suspect you could get it for around €150,000. Be frugal and creative with your renovations…paint a few walls, rent a tile saw and learn to tile (it really is quite easy)…and you could own a home near the river, with your own outdoor area “in town” for about €200,000.

In the End

So there you have it. 4 places to live from under €200,000 to just over half a million. Of course, you can often find the “best deal” if you are willing to take on a project or buy off-plan. Regardless, it is important to be realistic about real estate prices in Portugal. I often meet with readers that are traveling through thinking they can get an updated 3 bedroom 2 bath home with a garden near town for under €150,000. Perhaps they have been watching YouTube videos like this one promoting a farm for sale for €57,500.

Also, keep in mind that mortgages in Portugal do not work the way they do in the US. If you aren’t familiar with Portuguese mortgages, please read this post.

I also think it is interesting that one of the agents I met when touring one of these properties said, “Frankly, I think if it is still on the market in 6 months it will be €50,000 less.” So if you are not in a hurry, you might want to rent for a while until we determine if there is going to be a housing recession.

Next Week: a “world games” comes to VRSA and it’s beginning to look a lot like Christmas.

1. And as always, I am NOT being compensated in any way for including these properties. I asked a friend to assist me in getting access to listings at four price points. I do not have a professional relationship with any of the listing or sales agents!

2. You will want to know the Energy Rating of the home or apartment you purchase. Electricity is very expensive in Portugal, when compared to the US, and is going up. Many Portuguese wear extra clothing when at home (including puffy coats) to cut down on energy bills. So beware!

3. Often the condo fees charged in Portugal are too low to fund the ongoing maintenance of the building. The condo fee for this apartment is €70/month. This is a bit higher than many condo fees.

4. But there is an elevator!

5. Oddly enough, both bathrooms are across the hall from one another on the first floor. Why?