Europe’s Best Kept Secret

Europe’s Best Kept Secret

Europe’s best kept secret. That’s how this part of the world is often described. Why? Because it has Europe’s best beaches, Europe’s best golf courses, one of Europe’s friendliest folk, it’s the chosen retirement destination for over 100,000 resident expatriates, and, added to all that, it’s Europe’s newest tax haven.

Several international publications have ranked Portugal as one of the best overseas retirement destinations, including the British broadsheet the Telegraph, which rated the country asthe “2nd best place to retire abroad.” A safe region, with very little crime and a laid-back lifestyle for expatriates, this destination caters equally to families and retirees, due to the wide variety of cultural, nature-based, sporting, gastronomic, and other activities. Long a popular summer destination for sunseekers and a winter-stay retreat for those getting away from Northern Europe’s colder months, the Algarve receives more than 5 million annual visitors through its airport alone, swelling the local population of approximately 350,000. Add to this the fact that it is the Portuguese people’s preferred holiday destination and that the Spanish love to visits its wilder western coast, and you begin to understand why, at peak times, several million more come here to experience its beauty.

Expect to enjoy the lifestyle if you holiday, study, or retire here, but count on some frustration if you move to the region to work. Business bureaucracy and the shrinking of the economy because of the financial crisis of 2008, mean that the region is not the obvious choice for those looking for employment. Entrepreneurs, on the other hand, will find that the region’s excellent communications infrastructure, pleasant working environment, and cheap and talented labor force, together with a range of EU and national incentives to encourage start-up activity, may well make this a preferred location for launching new business ideas.

If you are looking for a mix between the Algarve’s historical roots and the spectacular beaches for which it is famous, then look no further than Silves and Lagoa. These two municipalities, located slightly west of center in Portugal’s southernmost province, allow residents to experience the best the area has to offer.

The immaculate main square in Silves Best Kept Secret

Silves, nestled in verdant valleys surrounded by the country’s largest citrus-growing area, and on the banks of the Arade River, which is navigable to where it meets the sea at Portimão, offers a warm microclimate, and visitors here will feel comfortable all year round…but perhaps just a little flustered when temperatures soar in the summer! Silves’ undulating hills are located inland in the region known as the barrocal (pronounced “buh-rroh-kaal”) and are covered with indigenous bush and scrubland interspersed with the triad of regional trees: olive, carob, and fig. The barrocal and its fauna contrasts sharply with the expanse of white sandy beach of its only coastal town, Armação de Pêra.

For a variety of beaches, hop over to neighboring Lagoa, with the capital town of the same name, which is a much smaller municipality located close to the ocean. Most of its activity is related to tourism around the coastal resorts towns of Carvoeiro (pronounced “kuhr-voo-ey-roo”) and Ferragudo. Here’s my video tour of the area including the main towns covered in this issue of the ORL.

With the Portuguese being the largest fish eaters per capita in Europe, finding fresh fish at one of the many daily markets is not difficult. Add to that a variety of fresh produce grown in the region and available in the local markets of both towns, and there is no excuse for unhealthy eating of any type! Wash your meal down with one of several local wines and you have the makings of a superb, yet healthy, gastronomic lifestyle.

Portugal has, according to a past Bloomberg report, the lowest cost of living in Western Europe. A variety of competing supermarkets in the Silves and Lagoa area make this area on average 30% cheaper than most European countries further north.

A quiet day at Silves market Best Kept Secret

The Silves and Lagoa areas are positioning themselves as leaders in the retirement sector within the Algarve, Portugal, and Iberian Peninsula. Two of the region’s pioneering projects in senior living will be launched in these two municipalities— see “Making The Right Property Choice” for more information.

Add to these factors recent legislation that allows many foreign residents to receive pensions tax-free in the country, and you would be hard pressed to find many similarly attractive retirement destinations in the heart of Europe, because the Algarve is Europe’s best kept secret.

The Next Big Thing

The Next Big Thing

It’s all about retirement. Portugal and the Algarve have been through major infrastructural investment such as highways— the country has Europe’s fifth best roads—and airports— Faro has already receives over 5 million passengers a year, equivalent to half the country’s population. The Algarve is set to be the next big thing and already is a world-recognized tourist and golf destination… at last count there were 42 courses in less than 100 miles. Healthcare is good and some public hospitals have gained a reputation for excellence, as is the case of Faro Hospital and its cardiology unit. Investment in public facilities is visible in the modern sporting and pool complexes that exist in many towns.

Major recent changes have been made to the legal and tax framework. The government has made it possible to earn pensions tax-free and there’s no wealth or inheritance tax (more on this below in “Tax And Financial Matter”). The region is moving away from a physical infrastructure and facilities focus towards an ever-stronger services and lifestyle drive. The next big thing is a move to senior living communities, allowing residents to rent or buy, as well as a huge push towards positioning the country as Europe’s most attractive tax-free destination for retirees.

The Lay Of The Land

The Algarve, located at Europe’s westernmost tip, has an area of 4,996 square kilometers (1,930 square miles) and a resident population of 450,993 inhabitants. It has an average population density of roughly 90.3 inhabitants per square kilometer (or 233 inhabitants per square mile) and an entirely Atlantic coastline that measures about 160 kilometers (100 miles) in length.

Lagoa’s 23,000 inhabitants reside in an area of 88 square kilometers (34 square miles)—the second smallest municipality in the Algarve by area—with a population density of 261 people per square kilometer (or about 676 people per square mile). In contrast, Silves’ population density is 54 inhabitants per square kilometer (or 141 inhabitants per square mile), with its 37,000 inhabitants scattered over an area of 680 square kilometers (262 square miles)—the largest municipality by area.

Dive in at Caneiros—quintessentially Algarve

The region is geographically subdivided into three main areas, each of which contains some extraordinarily beautiful landscapes, and all of which are represented within the municipalities of Lagoa and Silves (* Source:

The coastal area is where most of the region’s economic activity is concentrated. In terms of landscape, the Algarve coast is very diversified, varying between an abrupt and jagged coastline and extensive sandy beaches, inlets formed by lagoons, marshland areas, and various formations of sand dunes. The coastal area has a low altitude and consists mainly of plains, divided into fields and meadows.

The “Barrocal” area marks the transition between the coast and the mountains, consisting of limestone and schist. This area is also known as the “beira-serra” (literally the mountain edge) and is where most of the agricultural produce of the Algarve originates.

The hills occupy 50% of the territory and are formed from schist and some granitic rocks.

A Long, Nautical History

Lagoa’s history is linked to the sea. Despite the capital city of the same name being inland, the fisherman’s villages of Carvoeiro and Ferragudo played an important part in the fishing and fish-preserves industries. The villages of Estômbar and Porches were important centers in the Islamic and medieval periods; Porches became the leading center for the design and manufacture of pottery and has become synonymous with the center of the modern pottery industry in the Algarve.

Modern Lagoa meshes well with its ancient history. Cobbled streets, whitewashed houses with lace-patterned chimneys, and an abundance of fig, olive, almond, and carob trees, are all vivid memories of important aspects of what made this area unique.

The ancient and the modern sit side-by-side in Lagoa

Silves is also a municipality steeped in history. The presence of man during the Paleolithic period is confirmed by one archaeological site. The municipality was inhabited during the Neolithic period and the Bronze and Iron Ages, a fact borne out by numerous archaeological finds. Impressive megalithic monuments—menhirs—carved out of the region’s red sandstone and limestone, are scattered across the municipality.

The Arade River was the route to the interior favored by the vessels of the Mediterranean peoples—Phoenicians, Greeks, and Carthaginians—who were drawn to the region by the copper and iron mined in the western Algarve. This much is evident from the archaeological site at Cerro da Rocha Branca—unfortunately destroyed—about half a mile away from Silves, which was inhabited from the end of The Bronze Age onwards. In the 4th century B.C., Silves boasted a strong defensive wall. In the ensuing centuries both the Romans and the Moors occupied it.

Silves owes its existence to the navigability of the Arade River and to its strategic position atop a hill that dominates a broad swathe of countryside. It was possibly founded during the period of Roman rule, but it was with the Moorish invasion that began around 714-716 that Silves became a prosperous city. By the 11th century, it was the capital of the Algarve and according to some authors surpassed Lisbon in size and importance. At this time Silves was also a center of culture, home to poets, chroniclers, and lawmakers.

Cobbled streets lined with traditional houses in Silves

The religious and political tremors that rocked the Moslem world in the 11th and 12th centuries were felt in Silves too, where they manifested themselves in clashes between rival factions and frequent changes of ruler. King Sancho I took advantage of this internal division to lay siege to the city in 1189. His army was aided by crusaders from Northern Europe who were on their way to the Holy Land.

The fight for Silves was long and cruel and, according to chronicles of the time, many of its inhabitants perished, killed by hunger and thirst, or were slaughtered when the crusaders sacked the town. Portuguese rule was short-lived and in 1191 the city was recaptured by the Moors.

Despite having lost many of its inhabitants and much of its wealth, Silves was elevated to the status of Episcopal see and headquarters of the military government after the definitive conquest of the city in the context of the Christian occupation of the Algarve—1242 to 1249—which was concluded in the reign of King Afonso lll.

The centuries that followed were a difficult time for Silves. With the severance of its former links with North Africa and the gradual silting up of the river, it found itself side-lined from thelucrative maritime trade. Consequently, its economic, political, and military influence dwindled, while places like Lagos, Portimão, and Faro grew in importance. Natural catastrophes like the plague, earthquakes, and fevers caused by the swamp that formed where the Arade had once flowed also contributed to the town’s decline.

The great provider the bountiful Atlantic

The coup de grace came after the Episcopal order in 1534 instructed the transfer of the Episcopal see to Faro. Silves was never to recover its past splendor and for almost three centuries it was a city inhabited by only a few remaining citizens.

In the second half of the 19th century dried fruit and, above all, cork breathed new life into the city, which became one of the main processing centers for those products. Today Silves has Europe’s only cork museum as testament to the importance of that product to its economy. It is orange farming that today makes Silves the most important citrus producing region in Portugal. Due to its central location, Silves also plays an important role in the national transport infrastructure, with Tunes the main rail entry and exit point from the Algarve province, and the A2 and A22 highways, the most important routes within and from the Algarve, passing through the
municipality. (* Source: