THE FUTURE OF THE RENTAL MARKET IN PORTUGAL?
As recently as two years ago, it was unquestionable that Portugal provided Europe’s best investment destination. A growing economy, falling unemployment, a recovering real estate market, an investment surge in real estate driven primarily by the very successful Golden Visa program, a wave of (mostly) wealthy foreign retiree immigration driven by the Non Habitual Resident program, all this fuelled by 8 successive record-breaking years in the tourism industry, and no one could question the underlying fundamentals. Add to this the fact that Portugal had taken a long time to start to recover from the losses caused by the 2008-9 financial crisis, with property values falling as much as 40% in some locations.
The result of the perception of an improvement in the investment climate and the many measures intended to stimulate the economy was a jump in foreign investment. No sector felt the impact of this increase in capital inflows like the real estate market. From Chinese investors to French residents, the country’s real estate boomed and in 3 years, Lisbon had seen property growth of 60% and off-plan sales of modern, new-build product were back to full swing as if the recession had never happened.
Much of the growth was caused by investors who saw in Portugal not only an opportunity for capital appreciation from a low base, but also the possibility of rental yields. The country’s regulated, but very low tax, regime called the Alojamento Local, meant that early buyers who made their property available to the short-term rental market, were paying approximately 4% tax on gross revenues.
However, since then, we have observed the beginnings of dissatisfaction with over-tourism, the “expulsion” of local residents by (mostly) foreign owners, leading to a loss of character of entire neighbourhoods which were the drawcard attracting investors and visitors alike to the country’s authenticity, and an increased lack of respect for remaining local residents.
As a result, the government, which is in a parliamentary coalition with far-left parties, has set out a strategy of (not-so-gradual) assault on those perceived to be wealthy. And, unfortunately, as houses and apartments with sea views elicit a much more visceral response than pieces of paper known as shares or even a pile of intaglio paper known as money sitting in bank coffers, the government has set its sights firmly on financially penalising all those who own real estate.
While long-term rental contracts have historically paid capital gains tax (mais valias) on gross revenues, the government now appears to have the short-term rental market in its sights, especially if property is being managed as a short-term investment or let to the short-term or tourist market. There is talk that taxation may reduce for longer, more stable contracts, meaning that the discourse is that the short-term rental market may soon lose some of the many advantages it has, relative to longer contracts.
In 2017, the Portuguese government started its assault on real estate owners by approving the AIMI, an extraordinary real estate tax which applied to all owners who singly owned more than €600,000 of real estate (or €1,2 million as a couple). The law was named after the leader of Portugal’s extreme-left party, who campaigned tirelessly for its adoption.
Also in 2017, changes to the local lodging (Alojamento Local) legislation were implemented, including:
- An increase of the taxation basis from 15% to 35% of gross revenue, meaning an effective increase in the base rate of taxation on short-term rentals from less than 4% to around 10%. While still very competitive, the increase was significant
- Application of employer’s social security for companies managing client properties
- Higher water rates in some municipalities for properties registered as local lodging
- The need to present detailed calculations and proof of expenses, effectively eliminating the simplified regime for owners with annual rental values of around €27,000
It was also in this year that owners of local lodging establishments became aware that all of them had been caught by a little-known legislation which meant that anyone registering for short-term rentals was liable for capital gains. This remains an unclear and little-known aspect of the Alojamento Local.
In 2018, with a number of complaints about the effects of excessive tourism and short-term let properties, and the adoption of stricter rules in locations as diverse as Paris, Barcelona, New Zealand, Thailand, and Croatia, meant it was only a matter of time before the government started to change short-term rentals even further. New legislation, which has been approved by parliament and promulgated by the President, broadly forces the following changes:
- Municipalities will have the right to define zones with quotas on the number of short-term let properties, and owners will be limited to a maximum of 7 short-term rental properties within these zones
- Local lodging licences are personal and non-transferable in these areas and so if the property is sold, the new owner may not be able to get the licence renewed if the quota for that area has been reached. Buyers should be particularly careful about historical suburbs of Lisbon including Mouraria, Restelo and similar
- Condominiums will have the right to determine if and whether local lodging can be assigned to a property. Approval will require at least 50% of all voting members or owners
- Condominiums can charge a premium of up to 30% on condominium fees for those renting short-term
- Multi-risk and liability insurance is compulsory and must now also cover damage by clients to condominiums
- All client and tenant documentation must now be in three languages
These legislative changes will come into effect 60 days after their final approval in Parliament, forecast for October.
As a result of these changes, the market is starting to look more seriously at long-term rentals. Because long-term rentals, and even longer winter rentals of 8 months or more, are scarce (most owners prefer to make as much money as possible in the summer), Algarve Senior Living explains to customers how winter lets can complement summer revenue or substitute, in most cases, the summer revenue through an alternative model. Although online booking platforms have made direct marketing by owners much easier, and drastically reduced the role of the tour operator, many owners have yet to fill their properties fully beyond the peak months. It is important that owners do detailed calculations including expenses and tax, to determine which model works best for their propery/ies.
Algarve Senior Living has operated its unique model of long winter monthly lets, alongside the shorter summer weekly lets, for several years. Owners are now questioning whether they should consider transitioning to long lets if they currently operate summer lets only. We have seen an increase in the number of our property owners making their properties available for at least 6 months in the winter, in an attempt to balance the revenue streams in the summer and winter.
Advantages for owners of long-term and winter lets in their properties
- Winter lets are an excellent way to make extra revenue in months which are usually slow and where properties are closed
- Taxes and legislation surrounding short-term rentals are increasing, with more changes already approved by Parliament and the President set to become law by the end of 2018. Long-term rentals avoid these changes which affect the short-term lettings market
- There is already talk of a property and a real estate bubble impacting short-term rental values so owners can protect their assets by negotiating good long-term rental values while the market is still buoyant
- While the taxation is higher (28% versus around 10-16%, depending on VAT, for short lets), this difference is forecast to reduce as taxation on short lets increases
- Expenses, including cleaning, in long-term lets are paid by the tenant and not included in the rental
- Security deposits are higher, churn is lower
- Commissions from third parties may be lower. In the case of Algarve Senior Living, commission is added to the negotiated base rental amount
- Owners have time to vet and select their guests. Checking references is possible
- Long-term tenants tend to be seniors or families. There is less damage and properties benefit from year-round occupation
- For owners with Alojamento Local, 2018 is the year in which they can move their property from category B (Alojamento Local or local lodging) to category F (Arrendamento or long-term let) and suspend any capital gains which has been caused by the AL status. This is of particular relevance to any resident owners, such as Portuguese landlords, as CGT is much lower as a resident.
Advantages for tenants of a long-term rental
- Stability: knowing that they have a place to stay throughout the year, without the price fluctuations of the expensive summer months
- Visibility of expenses allowing for better planning
- Expenses are controlled directly by tenants, so if they wish to use more air conditioning or heating, they pay the bill, whereas if they decide to use blankets, they can save
- Contracts will allow those tenants who qualify, to apply for Portugal’s tax-free Non Habitual Resident status
Challenges for tenants of a long-term rentals
- Algarve Senior Living explains in detail the reason why tenants cannot expect to find quality property in good locations at discounted prices: in addition to the boom in demand, many tenants did not understand that long-term rentals are still taxed much higher than shorter rentals
- Many tenants looking for a long-term or annual rent, finding prices higher than they imagined, enter into a shorter contract in the slower winter months hoping they will then find something suitable when they are living locally. While this is sometimes the case, it often does not work for three reasons:
- The area selected is not necessarily the one in which they finally wish to settle. Their landlord has no knowledge of other areas nor any interest in finding a solution which will mean losing a winter rental earlier than planned
- There may be a special requirement, such as pets, which makes the list of available inventory very short indeed. Companies like Algarve Senior Living have spent years compiling their portfolio of properties which often involves months of negotiation with owners. Even then inventory changes but due to a larger variety, finding an alternative is usually possible
- Every winter month which passes brings us closer to the expensive summer months which in turn sees a decrease in inventory and an increase in price. Often owners, who in November are nervous when they see an empty winter in front of them, become much more confident by March when they see the approaching summer months
- The largest challenge for tenants is to understand that often sacrificing one or more criteria in order to get a full-year rental contract, is better than sacrificing the length of time in the hope of then finding the perfect solution later. Without exception, the latter approach is always more expensive.
Algarve Senior Living hopes to continue to play an active role in explaining the benefits of long lets to property owners, and implementing fair long-term rental pricing for tenants in the context of a booming market. Our investment in www.luz-living.com, the Algarve’s first coastal residential project for expatriate seniors, offering both apartments to purchase or for long lets, underscores our commitment to this model.
Live Like A King For Less – Budget Comparisons
The cost to live in Portugal is generally among the lowest in Western Europe. Some items, such as fuel (around €1.30/ liter or about US$5/gallon), electricity, second hand cars (Ford Focus 2012 diesel between €12,000 and €20,000, Audi A4 Avant diesel starting at €40,000) and electronic items such as appliances and technology, are much more expensive than in the US, but basic items are very competitive, especially when compared to Northern Europe. The keen grocery bargain hunter should also remain alert to extended weekend specials. With careful planning of your budget, residents are able to find discounts on some essential items every week.
Most foreigners find the cost of eating out to be very reasonable. In fact, for a retired couple, it is often as costeffective to eat out and warm up leftovers in the evening (portions in Portugal are generous). Local supermarket chain Pingo Doce operates a number of family friendly restaurants where meals, all prepared daily, cost €3.99 plus the price of a drink. Some even run a daily special including a drink and bread roll for €3.50. Local restaurants, with which most new arrivals quickly become familiar, value regular trade and it is possible to negotiate a meal for two including soup, main meal, soft drink (or glass of wine), and coffee for €10. Do not expect a fancy ambience or service frills, but the quality of the Piri-piri, freshly picked veg, and local honey at the indoor market food is excellent for the price. Finding the preferred, low price local restaurant is a favorite past-time of most expatriates.
Buyer beware: whenever you see a menu in multiple languages, expect to pay more as the restaurant is targeting a foreign tourist market. If you want authenticity at a low price, look out for the “Pratos do dia” (dishes of the day) signs scribbled on a blackboard or paper stuck to the entrance. Prepared in larger quantities and with different fish and meat dishes every day, this is the way to get a tasty local meal for around €5-6.50. Be prepared to get by with sign language, basic English words, a phrase book, and a friendly smile, and you will save yourself money when eating out.
Eating out in Carvoeiro and Silves are two different experiences. Try Silves if you want authentic Portuguese eating. Strangely, one of the region’s most famous seafood restaurants, Rui Marisqueira, is located in the inland city! But a visit to Rui’s is not complete without tasting their carob tart, freshly made and delivered from a local pastry specialist. They don’t always have it, but don’t miss it if it’s in the pastry display. Move next door and try the suckling pig at Fernando dos Leitões. Popular with many tourists are the chicken restaurants that are located on the road next to the river. Arrive early and don’t expect to see a menu. They do portions and half portions of freshly grilled chicken (the chef does it under a plastic tarpaulin where the temperature of his ‘kitchen’ is often hotter than the grill!), freshly fried chips, and salted and seasoned lettuce and tomato salad. Keep ordering portions until you are full…
you’ll be surprised when you are handed the very reasonable final bill.
On the way between Silves and Lagoa is the Barradas restaurant, pricey by Portuguese standards but with great options and an impressive wine selection.
When reaching Lagoa and especially the village of Carvoeiro, you will be spoilt for choice. The town has a famous hill that is packed both sides with commercial establishments, most of which are restaurants of all types: traditional Portuguese, Italian, Chinese, Thai, the odd English or Irish pub, and even some vegetarian options. Ele & Ela is consistently ranked highly by its diners for its excellent cuisine, and two stand-out quality restaurants are located on the road between Carvoeiro and Sesmarias: Hexagone and Bon Bon. If it’s cheap and filling Portuguese fare you are after, try one of the many options around the Fatacil fair grounds.
A full meal in a cheap restaurant will cost you around €8 including drink and coffee, a very friendly budget. Expensive restaurants will cost between €35-50 per head, including good wine. On average expect to pay between €15-20 for dinner. Lunch is usually cheaper as most people do not order wine, and menus often have quicker and easier-to-prepare options.
Algarve Monthly Budget
No Language Worries In The California Of Europe
The Portuguese, according to CNN’s Friendliest Countries report, are the “7th most welcoming people in the world.” The World Economic Forum ranked Portugal as 7th (among 140 survey nations) most-welcoming nation when receiving foreign visitors. In the field of language the Portuguese go above and beyond the reasonable to ensure that guests are made to feel welcome in their own tongue. Portuguese is a difficult language to master but some basic knowledge will accelerate integration and make simple daily tasks easier. Some language schools exist but there are well-qualified freelance language teachers who teach Portuguese at each student’s pace.
The Association of Foreign Property Owners in Portugal, or AFPOP, caters to the many foreign residents and property owners in the country, and offers a range of services and discounts to members. With membership at €40 per annum, the benefits quickly outweigh the cost.
Due to Portugal’s strong cultural and historical links with England and the fact that the Algarve is such a major tourist destination, English is widely spoken. English is compulsory as a second language in the schooling system and so the youngest generation speaks it. French, which was the second school language prior to being overtaken by English, is extensively spoken by the older generations. Portugal’s largest expatriate population lives in France, and many of those people, nearing retirement and spurred on by adverse changes in French pensions and positive changes in Portuguese laws affecting pensions, have decided to return to the country.
Many establishments including restaurants, private and public health centers, and hospitals, clinics, sports clubs, and supermarkets, have people able to interact with the public in a foreign language.
In Lagoa there is a well-established second-hand bookstore with thousands of foreign titles and many genres. Hand in your used books for a credit of between €1-3 and use your balance to buy other titles from as little as €2.50.
In summary, the Algarve is very well-placed linguistically to receive visitors and new residents from the USA and Canada.
Fatacil is the largest showground in the province and hosts several large events during the year. The most popular for expats is the International Algarve Fair held in June every year, which unites the local and expatriate community around a variety of activities, shows, services and food and beverage. Larger still is the summer fair held in August, with daily live concerts by top national (and often international) artists. At a few euros a ticket per day, you won’t find better value for money on a sultry summer night.
The Medieval fair in Silves is a celebration of the city’s roots. Dancers, jugglers, flame-throwers, fire-eaters, and snake charmers, and snake charmers combine with a feast of regional cuisine to offer a very authentic experience. Costumes can be hired by those who want to dress the part!
In Lagoa, the annual sweets festival is an exquisite display of delicacies produced mainly from local ingredients, including fig, orange and almond, and the lesser-known carob with its cocoa-like powder—a staple ingredient in regional Multilingual menus, but reasonable prices for all tongues pastry making.
Around June every year, the smell of grilled sardines permeates the air of the coastal towns, as the annual sardine season peaks. Most traditional restaurants will keep them coming until you say ‘basta!’ Pay by the half-dozen and you know you’re in a tourist establishment.
Throughout the year, but mainly from spring through fall, to make the most of the great weather, open-air jazz and
classical concerts are held. Most are free. Experience jazz at Lagoa’s Sitio das Fontes but make sure you take some mosquito repellant because the idyllic location, on the Arade River, becomes a haven for these pests at nightfall. The Lagoa Auditorium is the place to take in a concert by the local youth orchestra (or even attend students’ final auditions that are open to the public) or to watch a film priced between €3-4 per ticket.
The Arade Congress Centre, a white elephant financed by several municipalities, private groups, and the regional tourist body, is nonetheless one of the most impressive congress centers in the country. With Europe’s fifth largest stage and seating which, when retracted, increases the capacity from 1,000 to 4,000 or more, it sits quietly on the banks of the Arade River near the town of Ferragudo. Once or twice a year it springs to life with a motor car launch, a performance by the Russian ballet, or the finals of the World Dance championships.
If it’s sporting action you’re after, try something different. The daughter of the owner of one of the largest boat businesses is a multi-world champion and the family is always happy to offer adventure style practice sessions on the Arade. Kayaking, paddling, and scenic boat trips are all on your doorstep. And don’t forget the boat trips to visit the cave-encrusted coastline or to fish. Or the sailing schools at the river mouth which are, by international standards, inexpensive.
For the tennis enthusiast, join the many expats who gather for social tennis at the Carvoeiro tennis club, or try the local club at Silves, located between the schools of the city and next to a park (to which you might have to retire to for shade if you dare play in the summer afternoons!).
Carvoeiro also has a well-stocked book exchange that allows expatriate residents and visitors alike to trade in books they have read for new titles.
Many retired expatriates become involved in local community or charity work: from manning kitchens, which serve meals to the homeless, to assisting with food distribution to the poor, supporting the donkey sanctuary, or helping with the housing of abandoned dogs, there is no shortage of opportunities to contribute to society and make a real impact that will also help you integrate faster into local culture. Although Portugal is a highly religious country and many social actions are coordinated by the church, there is an increasing trend for people to organize volunteer organizations, often bringing new and innovative ways of doing this from their experiences abroad. See the “Rolodex” for contact volunteer information.
Getting About…Drive, Walk, Sail, Cycle, And Paddle
Driving is easy in this part of the world. Short drives are often scenic. Leave Lagoa along the EN125 road westward towards the large town of Portimão. The approximately 5-mile drive involves crossing the Arade River near its estuary. See flocks of migrating or nesting birds, canoeists, and the occasional angler in galoshes searching for cockles. Return via the picturesque village of Ferragudo.
Local transport is reliable but the intervals between departures out of peak times can be long, especially in smaller village and inland locations. The municipality of Silves contains the province’s main train station link, at Tunes, to the country’s capital 180 miles away. Lagoa has one of the region’s busiest bus stations, with buses leaving for locations in the Algarve and direct to Lisbon, a 3-hour trip away in luxury vehicles with Wi-Fi, in-trip movies, toilet facilities, and reclining seats.
Tackle the rugged coastal paths on a mountain bike or on foot and get the benefit of spectacular sea and coastal views. Both Silves and Lagoa are easy to visit on foot and walking is much more popular in towns and cities than cycling.
The Arade River flows through the center of Silves. At high tide, small riverboats make their way downstream to the river mouth at Ferragudo and Portimão, and then back upstream. Kayak and canoe enthusiasts are often found paddling up and downstream.
How Easy Is It For The Disabled?
The Portuguese attitude towards helping others is reflected in a general openness towards minorities, in whatever sense. The disabled are no exception, but they have been faced, historically, with the challenge of inappropriate infrastructure, such as traditional stone sidewalks that are difficult for wheelchairs and for people with canes or walking aids, few ramps into public transport, and poor signposting. Portugal’s infrastructure is improving for disabled communities and it is generally true that where specific conditions do not exist, local people will go out of their way to help. Silves and Lagoa have benefited from significant retrofits to existing or newer facilities. Community swimming pools are fully equipped with ramps and disabled pool access, public buildings such as libraries now have disabled access, and even public parks make it easy for the disabled to be dropped off and enter with reduced effort.
The Gay And Lesbian Community
Historically Portugal is a deeply Catholic country. For this reason many of the beliefs and religious traditions remain, although change to this belief system has accelerated dramatically with globalization, the free flow of people and ideas over country borders, national debate around topics such as adoption by couples of the same sex, and changes in the law. The GLBT community is neither large nor very visible. Do not be surprised, therefore, if you and your partner visit a remote area and get inquisitive looks from the locals.
How To Get Here
Faro airport, located around 60 kilometers (38 miles) from both Silves and Lagoa, is one of Portugal’s busiest airports and its most important tourist hub, handling about 5.5 million passengers a year. Direct flights arrive from 76 international and three national airports. Airsat’s recent addition of a weekly direct flight from Toronto’s Pearson Airport means that the destination is now directly accessible to the Canadian market. If you travel from the US, you would probably connect via a major European capital.
Well in excess of 4 million visitors arrive in the busy July- August period, which means that the remaining months are remarkably tranquil for travelers.
The A22 highway links Silves/Lagoa to Spain, 112 kilometers (70 miles) away. The cost of the one-way toll is approximately €7.70. The A2 highway, with easy access from Silves via Tunes, makes Lisbon, the country’s capital, approximately a 3-hour drive. Taking the fast route to Lisbon via the toll highway, where legal speed limits are 120 km/h (75 mph), will cost around €20 for the 180-mile drive. Choose the more leisurely route along the national road, which is mostly in excellent condition, and where you can stop to eat at one of the many traditional restaurants or have a picnic on one of the route’s scenic vantage points, and spend only €4 on tolls (the saving will pay for a meal for two!).
Bringing Pets To Portugal
The transportation and importation of pets is well regulated in the EU and the rules applicable to Portugal are documented on the relevant Ministry site, which is also available in English, here.
Unfortunately, the economic crisis of 2008 resulted in a significant increase in the abandonment of animals by people who could no longer afford to keep them. Although there are local municipal kennels, due to overcrowding they tend to operate a strict policy of putting animals down after a week if they have not been rehomed. There are several local charities, including a few charity shops in Lagoa and at least one in Silves, which raise money for initiatives such as the Donkey Sanctuary and the Association for the Protection of Animals in the Algarve (APAA). The Scruffts dog show held annually at Fatacil is also a source of complementary income for the work they do. These organizations are always looking for volunteers to help in whatever way possible and it is a great way to get involved if you are an animal lover. See the “Rolodex” for contact information.
Warts And All
The biggest complaint of most people who arrive here is Portuguese bureaucracy. Much of this is due to a language barrier which makes matters such as finance, tax, and dealing with banks and utility providers frustrating at times (especially as the latter generally have poor records of customer service). Nonetheless, renewing or getting a driver’s license is easier than doing so in the US, for example, as Portugal has migrated most of its public record system to electronic records over the last decade or so.
My recommendation would be to stay away from any project involving planning. If you are a keen builder, developer, or would like to make substantial changes to existing historical buildings (such as converting them into boutique hotels)… choose another location. Planning is a lengthy process requiring years, with major projects often taking more than a decade to clear the upward of 30 entities who typically need to give their opinion as to the merits of any endeavor.
Starting a business in Portugal, while not as complex as in countries such as Brazil, is not as efficient as in countries such as the US. Accounting requirements can be complex and appropriate legal, tax, and accounting support is a must for new arrivals wanting to work in or from Portugal.
Many people are concerned about the economic woes of the country prior to and following its bailout post-2008. While this is indeed a concern for existing residents who have seen the tax burden increase, the NHR measure is aimed at attracting new residents to the country and guaranteeing low tax. New residents will benefit not only from this status but also from Portugal’s need to become more competitive, which in many instances has driven down prices. An excellent example is real estate.
New residents should consider carefully where they live, because the inland areas of municipalities such as Silves have very few inhabitants, and the initial search for quiet and privacy can quickly turn to isolation as foreigners find themselves far from town and city centers and unable to communicate with rural populations whose command of English is not as good as that of people in towns and cities.
Almost without exception those who have chosen Portugal as their home, and have planned financially for their move, are extremely positive about the country and its lifestyle.
Is This The Place For You?
If you want an excellent quality of life, with a low cost of living or budget, great tax benefits, in a location that within easy access of all of Europe and equidistant from North America and Asia, the Algarve is an obvious option. If you seek the tranquility of country living while being minutes from the region’s awardwinning beaches and golf courses, and from the hustle and bustle of a range of tourist activities, then Silves and Lagoa are excellent choices.
The ability to save money, pay less tax, access quality healthcare, enjoy a healthy lifestyle, be part of a community
where English is widely spoken, and get to most European cities in less than three hours, are major attractions for foreign residents.
Most people who move here notice the change of pace from large cities and towns. It takes time, like good wine, to mellow. If you are moving here to work locally, be prepared for some stress relating to bureaucracy and the difficulty in the language if you don’t already speak it. If you are looking to work abroad and want to leave your family in a safe, healthy environment, then look no further. Hundreds of expats already do this, and once the secret is out, many more will do so. If you wish to retire, there is hardly a person who has visited who does not think of staying for good. Making friends is easy, whether with locals or expatriates. The fact that new residents will soon have an option to reside in rental communities of like-minded individuals, who share interests, means that purchasing properties is not the only route for new arrivals.
With all this and a lot more, it is easy to see why the region has attracted more than 63,000 official residents or about 15% of the region’s population—although the number is several times higher as many foreigners remain in the country for a substantial part of the year but never become officially resident. Just over 4,500 of these residents live in the Silves municipality and 3,700 in the Lagoa municipality*, with Carvoeiro being one of the most popular multicultural expat towns in the Algarve, catering to a range of nationalities. (* Source: www.sef.pt)
The World’s Most Stable Climate
World Weather Online states that the “Algarve enjoys one of the most stable climates in the world” with its moderate weather influenced by both the Atlantic and Mediterranean seas and its proximity to North Africa. Portugal has 3,300 hours of sunshine per year, one of the highest in Europe. The Algarve has a temperate climate and although bathed by the Atlantic, exhibits Mediterranean characteristics. Below are statistics for the province of the Algarve. Silves temperatures tend to be higher than the average for the region, given its microclimate which is much appreciated by many foreign visitors and residents.
Portugal ranks as the 17th safest country in the world, of a list of 153. Violent crime is very rare and petty crime is limited mostly to opportunistic incidents during the busy tourist season.
The OSAC report, produced by the US Bureau of Diplomatic Security, confirms that Portugal has no indigenous terrorist groups. Organized crime is not a major issue with the exception of isolated Eastern European or other immigrant groups. Foreigners, however, are well integrated into Portugal’s multi-ethic society and while the country remains predominantly Catholic, it is very tolerant of religious, ethnic, and cultural diversity.
Highways in Portugal are an excellent quality and the A22 highway is no exception. Portuguese drivers, although at times prone to speeding and impatience (in common with many southern Europeans) are nonetheless quite peaceful. Incidences of road rage are uncommon. It is more likely that visitors will become frustrated by an encounter with a 50 cc car (called mata velhos or ‘killers of old people’ because the cars, little more than a shell atop a motorbike engine, don’t have the safety features of modern vehicles) or with the occasional gypsy horse-drawn cart.
Lagoa, located on the busy EN125 road which also crosses the Algarve, is not considered an accident hot spot on what is otherwise one of the country’s busiest regional roads. The city of Silves, situated further inland, is a driver’s haven, with calm roads, respectful drivers, and no traffic jams.
112 is the national free number to call for most types of emergencies (from a fixed line or cellphone).
Where to begin!? Silves’ two beaches, Armação de Pera and Praia Grande, have blue flags awarded by the European Blue Flag association. Among Lagoa’s 17 spectacular beaches, some require bathers to descend large flights of stairs into wondrous cliff-enclosed coves bathed by azure waters. Others allow you to pull up and stroll out onto the light-colored sand. Most beaches have lifeguards during the summer season. Many have restaurants or snack bars, some of which stay open all year round.
World Renowned Golf
The Algarve has an enviable reputation as far as golf is concerned. With Portugal voted Europe’s ‘Best golf destination in Europe in 2014’ by the World Travel Awards, and the Algarve the gem of the Portuguese collection, it is no wonder that hundreds of thousands of visitors are attracted every year to the more than 40 golf courses dotted along a stretch of little more than 75 miles.
The Lagoa and Silves golfing landscape is dominated by the Pestana Group, Portugal’s top hotel group. The Pinta
and Gramacho golf courses in Lagoa and the Silves Golf course allow players of all abilities to test their skills against a backdrop of some of the region’s indigenous species of flora such as ancient carob and olive trees, combined with natural stone walls and artistic use of water features. With designs by famous US golf architect Ronald Fream, and South Africa’s Nick Price, a round of golf here is an experience. The 5-star Amendoeira golf resort—with 36 championship holes designed by Nick Faldo and Christy O’Connor Jr—is one of the seven golf courses operated by Portugal’s largest golf operator, Oceanico. For families or those who want to hone their pitching and putting skills, there is the 9-hole Vale do Milho course, with views to the Atlantic.
There are a number of specialist tour operators that not only book group golfing holidays but also arrange preferential tee times, discounts, and the all-important 19th hole arrangements!
The Tortoise and the Hare:
Rambling or racing from Lisbon to the Algarve
Portugal has just been voted the winner in the best European destination for American tourists, as voted by readers of 10Best Readers’ Choice and USA Today: www.10best.com/awards/travel/best-european-country. As the country’s capital, many intercontinental flights stop over in the Portuguese capital. While this may be an inconvenience for some, it presents a wonderful opportunity to experience the city (one of Europe’s most popular weekend getaways) and also to choose the way in which to connect to the visitor paradise of Portugal, the Algarve, located at the southernmost tip of the country, so here we let you know the top priorities from Lisbon to Algarve.
Portugal is one of the world’s 20 most visited countries, with over 13 million people visiting the country every year. After a long-haul or transatlantic flight, a few days in Lisbon are an opportunity to overcome jet lag and to adjust to the different weather and gastronomy, in the city voted by Food and Wine magazine as one of the world’s most romantic.
Being based in Lisbon is convenient in that most tours start in the capital. When on a short stay, highly recommended is a visit to Cascais with its beautiful cobbled streets and the amazing sweeping views over the bay and the Tagus estuary, and a wander through the medieval city of Sintra. The city’s Pena Palace was voted the continent’s most attractive castle by European Best Destinations, beating Neuschwanstein and Segovia’s Alcazar to the post. Only 30 kilometres (less than 20 miles) west of Lisbon, venture out by catching the train at the Cais do Sodré station near the Tagus River, which passes underneath the impressive 25th April bridge linking the popular Docas area to the Christ the Redeemer statue on the southern banks of the river. You will also pass the Torre de Belém and the Monument to the Discoveries, testament to the golden years of Portuguese maritime exploration. In the same vicinity, the Jerónimos monastery is a wonderful example of Manueline architecture (named after the King who ordered it built). Further along, pass Estoril, in the earlier part of the 20th century the place where the European wealthy congregated. The imposing casino, the country’s largest, is easily spotted from the train. Then hop on a bus or do a tour of Sintra, and make sure to try some of the sumptuous pastry!
Back in Lisbon, the options are almost endless. Stroll down Rua Augusta which Condé Nast Traveler has voted the street one would most wish to visit before dying! Climb up to St. George’s Castle and gaze out over Lisbon’s seven hills. Explore the Chiado with its fado singers and traditional dishes. Visit the modern redevelopment of the Expo area, with its modern architecture, cable car ride, scenic tower, views over the Vasco da Gama Bridge and Europe’s largest aquarium.
Ucityguides has ranked Portugal the 6th most beautiful country in the world, in a list topped by Italy, Spain and France, and which includes perennial favourites Brazil, South Africa and the USA. From Lisbon to Algarve, your final destination, beckoning, will you now be anxious to race to the California of Europe or tease your senses by meandering slowly through the Alentejo province?
If you choose the former, there is no better way to experience Portugal’s world-class infrastructure than to cross the Vasco da Gama Bridge and head straight down the A2 highway for an approximately two-and-a-half hour journey to the Algarve. Once there, the A22 highway will take you east to Vilamoura, Faro, Tavira and Spain and west to Lagoa/Carvoeiro, Portimão, Lagos and Sagres, including crossing the fabulous bridge over the Arade River.
If your choice is to take your time down to your final destination, then cross the 25 de Abril bridge, pass Christ the Redeemer and continue south on the A2 until the exit at Alcácer do Sal. Take the national road which gives you a bird’s eye-view of the Sado River and one of the largest rice plantations in the country. Make the most to stop off for a bite to eat at one of the simple road-side restaurants serving typical Alentejo dishes.
After probably having overindulged on generous portions, make your way to the coastal road and be prepared to spend a few hours on a meandering road, but well worth the effort to turn off to visit Porto Covo, Vila Nova de Milfontes, Zambujeira do Mar and Aljezur. Before heading down towards Lagos and the western Algarve, make one more stop – take the circular route via the beaches at Bordeira and Carrapateira.
Nothing drives home the reason why the World Travel Awards have anointed the Algarve as Europe’s leading beach destination than looking out at miles of pristine beach, sand dunes and river, knowing that some miles further south, lies the first of the 40 golf courses which contributed to the World Golf awards voting Portugal as the World and Europe’s leading Golf Destination for 2014. Just a small part of the reason why the Algarve is the Best Place in the World to Retire.
The Algarve: Best Place in the World to Retire!
Finally it is official!
It has been coming for some time, it must be said. Europe’s leading beach destination – World Travel Awards. 2nd best place to retire overseas – The Telegraph. 7thfriendliest nation in the world (among 140 surveyed) – CNN. World’s leading Golf Destination – WTA.
And now: Algarve, Portugal: Best Place in the World to Retire – 2014 Retire Overseas Index.
The index, which has just been published, sees the Algarve ranked ahead of 21 global locations including places such as Abruzzo in Italy, Barcelona in Spain, Istria in Croatia, Pau in France, Chaing Mai in Thailand, Istanbul in Turkey, Dumaguete in the Philippines, Ambergris Caye in Belize, Mendoza in Argentina, Puerto Vallarta in Mexico and City Beaches in Panama.
The ranking was compiled using 12 criteria including climate, cost of living, crime, English spoken, entertainment, environmental conditions, existing expat community, healthcare, infrastructure, real estate, residency options and taxes. Portugal scored top marks in several categories: it received an A for its sizeable 100,000 expat community which allowed new arrivals to integrate faster; an A for Environment, an A for Crime (I think that should be lack of Crime!); and A for infrastructure, recognition that EU money was actually spent on something tangible; an A for Residency and of course an A for climate – no surprise there!
Surprisingly for many, but not us, it was awarded an A for Entertainment. This is not New York or London, but you can see a World Premiere of a musical – Blind Faith has its run of 8 performances in October before starting a 60 performance tour in the UK. It isn’t New Orleans or Paris, but you can enjoy jazz, fado, youth orchestras or ballet, most weeks of the year. It isn’t Flushing Meadow or Adelaide, but you can play a tennis tournament most weekends. Wentworth it ain’t but talk to any of the pros and they will tell you that among the 42 courses that grace the Algarve, there will be at least one that will match your favourite anywhere in the world. Plus you won’t have to travel more than an hour to reach any of them. And when it comes to traditional markets and an array of dining experiences, well, there is really no need to travel to Florence, Rio de Janeiro or even Spitalfields.
Health and Real Estate ranked as an A-. Taxes only ranked as a B because the Non Habitual Residency programme, which allows many new resident foreigners to earn pensions tax-free, only lasts 10 years for any qualifying individual. And the Algarve’s lone C was earned in the English Spoken category, not because few people speak English in the region but because Portuguese as a language is considered very difficult for a foreigner to learn.
Forbes, the highly respected and influential magazine, business and entrepreneurial group, was quick to publish news of the Algarve’s new-found status for retirees. The report, which can be found at www.forbes.com/sites/nextavenue/2014/08/25/the-7-best-places-to-retire-around-the-world/, incorporates the summary of the comprehensive study conducted by Live and Invest Overseas, the US-based publisher which spent months analysing data from different countries.
As Kathleen Peddicord, publisher of Live and Invest Overseas, states of the Algarve and Portugal in general, “it’s the most affordable option in Europe for retirees” – www.forbes.com/pictures/fgmi45jlfe/no-1-the-algarve-portugal. But as she points out, “retiring part-time overseas can also be a good idea”. The publisher frequently encourages those wishing to retire to a new location to do so for a trial period before making a final decision.
Service-based solutions such as those run by www.algarveseniorliving.com, are changing the landscape of the decision-making process of new and potential retirees, providing a way to experience the lifestyle and the region’s many advantages (and any challenges) prior to taking the plunge.
Luis da Silva, Founder and Managing Director at Algarve Senior Living, who has been actively involved as a local correspondent for publications such as the Overseas Retirement Letter, states “we are passionate about living in the Algarve and the many benefits and advantages of life in the region.” Algarve Senior Living assisted in researching and providing relevant data to support the Algarve’s status as an excellent retirement destination.
Algarve Senior Living is not only walking the walk, by launching the region’s first flexible solution for independent seniors. It is also talking the talk, by trumpeting positive data on Europe’s most famous secret, now also the best place in the world to retire. Hope to see you at an Algarve Senior Living village soon, where we walk the talk!
The Non Habitual Resident law: a Case Study
I thought that Börje Forsberg looked tanned and relaxed. Although we had never met before, I assumed that this was because he was now retired to the Algarve. He was quick to confirm my first impressions. By his own admission, he now has a very different lifestyle to the one before his retirement four years ago, all due to the Non Habitual Resident law (NHR law).
We had organised to meet so that Mr. Forsberg, an experienced company director and still active non-executive director, could tell me a little about why he had become a resident of the Algarve, specifically the town of Lagos. In a very personal and genuine way, he was spontaneous in admitting that the death of a close friend to cancer four years ago had made him rethink his life and decide to bring forward plans to seek a change of lifestyle and reduce his “double shift of 30 years” which had taken him to hundreds of international working destinations.
That change included a renewed focus on friends, family, his grandchildren, new challenges and (surprisingly) travelling (but not work-related).
In a structured process often associated with Scandinavian thinking, his research process had included an analysis of Spain, Malta, and France, until settling on Portugal, which he had only visited twice before. After an initial visit to Cascais and the greater Lisbon area, it was Lagos, a city he describes as “genuine” and “not destroyed by tourists”, that he decided to settle, spending on average nine months of every year. Originally from Stockholm, he found that in the area, expatriates mingle easily with locals, and a sense of a normalcy prevails throughout the year (even in the heady summer season).
I assumed that his decision to adopt Lagos and the Algarve as his home involved more than the sea and pool views from his apartment, or the peaceful, balmy afternoons reading a book in the shade of the overhang of the balcony above him. He quickly expanded on the reasons for his choice: “the culture, good food, good wine” (said, it must be added, with just a hint of a smile), all added up to the “perfect” location for him. With a population of just 20,000, even the swollen summer that brought with it probably another 100,000 did not create any significant traffic jams. Perhaps it is time that they “rebuild the old bridge”, he adds as a critical afterthought, referring to the city’s once-popular crossing between the city’s promenade and Meia Praia and which due to structural instability and a lack of funds had ceded its position to a new crossing further upstream.
And, of course, the tax situation. Mr. Forsberg found out about Portugal’s Non Habitual Resident law, which allows new eligible retirees to receive their pensions tax-free in the country. Even though it was not his main motivation, the 57% tax saving was the icing on the cake. Mr. Forsberg is quick to add, though: “don’t move if saving tax is your only reason”, implying of course that his was a weighted decision involving a number of variables. But there is no doubt that for Swedes, “Portugal is the number 1 option” from a tax perspective, better than even Malta which has traditionally been the destination of choice.
True to his promise to himself “to live a completely different life”, he now runs (or jogs) five times a week, plays some tennis, reads and finds time to deal with his approximately 20 daily e-mails (which made me admiring and insanely jealous at the same time, when thinking of my own inbox).
With views over the ocean and of the communal pool in his apartment complex, there could be worse places to retire, I thought. And a 50% tax saving as an added prize…no wonder Mr. Forsberg has already convinced ten of his Swedish friends to join him.
Remember the 80s, rejoice the senior artists – Billy Ocean!
The largest-ever crowd at a Cascais Revival Festival was restless. A rushed performance by the preceding act, who were eager to be off to see England play in the World Cup, had sprinkled the warm night air with tension. Among the assembled audience the anticipation steadily grew as the crew meticulously rolled out, positioned and locked into place the drum kit, the backing singer microphones, the saxophonist’s stand, and then, in turn, the remaining equipment.
The musicians and backing vocalists to make their way onto a stage tinged with blue light. In what seemed like seconds, they found their groove and a jazzy, soulful instrumental set the scene for what was to come.
Billy Ocean arrived, strolling like a youngster between the backing singers and the bass player, with his trademark permanent smile lighting up a face seemingly untouched by age. The main sign of ageing was the silver-white Rastafarian locks tied neatly into a ponytail.
Initially a little faint, but quickly increasing in volume as he found his stride and mastered the acoustics, the voice was barely changed from the 80s. A little twirl, a finger immediately singling out someone in the crowd – creating an instantaneous personal link with each and every person – and the audience was soon chanting out the chorus of ‘Stand up – Stand Up’.
Billy Ocean owned the stage as he delivered wonderful renditions of many of his greatest hits, including Mystery Lady, Suddenly, Getta Outta My Dreams, and When the Going Gets Tough. One moment we were listening to the slow and soulful Colour of Love, the next the slightly snappier but equally soul-filled Love Zone, and then onto the catchy pre-80s Love Really Hurts Without You. During the entire show, he treated the audience to some smooth moves, little shuffles, sidesteps and moments of introspection, still able to lose himself in his art. I admit I was concerned he would displace a hip at the start of Loverboy, but from the shouts and hoots from some ladies in the audience, it was clear his sacrifice was appreciated!
Affable and engaging, Billy Ocean displayed all the traits of a man at ease with himself and the world around him. He epitomised, I thought to myself as the music rolled on and I watched him sing and dance on the stage, the image of the mature individual, or senior, who is able to do things he likes after a long working career. Of course, in Billy Ocean’s case, his ‘hobby’ happens to be the same as his life-long profession, but I thought it illustrated the point nonetheless. It was clear that his decision to continue to perform was purposeful. When he introduced one of the backing singers as his daughter, part of his motivation was there for all to see – the opportunity to perform with one of his children. Similarly to Kim Wilde, who on the previous evening had been accompanied by her vivacious daughter, here was a man who, happy with his own life, was now able to impart some of that joy and energy to others, even at sixty four. In fact, I thought, it is probably because he is enjoying life that he is able to find a connection to the audience so easily.
During the concert, I looked around the audience and saw a variety of ages, mostly middle-aged couples, but some seniors, a few youngsters who had accompanied parents and several young adults who arrived in groups or as couples. People quickly lost their inhibitions, dancing (or shuffling) to the songs that they remembered or simply because they liked the tune. I found myself unashamedly singing along, surprised that I could recall so many of the lyrics and embarrassed that my booming voice was so off-key. This was pop music at its most interactive. The artist danced and the audience followed suit.
When he bade the audience farewell, everyone knew he would be back for an encore, but no one begrudged him a little ‘time out’ to recover after almost an hour and a half on stage. And surely enough, he was back out to sing two more tunes, ending as expected with his massive hit Caribbean Queen (which I half expected him to do in the European Queen version, given where he was).
I observed the crowd as it melted, slowly, into the moonlit evening, and chatted to someone who I think expressed the general sentiment: “What an artist. Kim Wilde was good last night, as was Rick Astley, but Billy Ocean was fantastic. At his age, what a show! And what a personality!”
I’m sure I speak on behalf of everyone in the audience when I say: It would be a pleasure to have this young-at-heart 64-year old back to entertain us again in the future. Well done, Billy Ocean, on such an engaging performance and to being a testament to what an active senior life should be like!
Cascais Revival Festival REMEMBERED!
The largest-ever crowd at a Cascais Revival Festival was restless. A rushed performance by the preceding act, eager to be off to see England play in the World Cup, had sprinkled the warm night air with tension. Anticipation steadily grew as musicians and vocalists made their way onto a stage tinged with blue light. In seconds a jazzy, soulful instrumental set the scene for what was to come.
Billy Ocean strolled on, his trademark permanent smile lighting up a face seemingly untouched by age. The main sign of ageing was the silver-white Rastafarian locks tied neatly into a ponytail. Initially a little faint, volume quickly increased as he found his stride and mastered the acoustics, his voice barely changed from the 80s. A finger singled out someone in the crowd to create an instantaneous personal link with each and every person. The audience was soon chanting out the chorus of ‘Stand up – Stand Up’.
He owned the stage delivering wonderful renditions of his greatest hits; Mystery Lady, Suddenly, Get Outta My Dreams, and When the Going Gets Tough. He treated us to some smooth moves – shuffles, sidesteps and moments of introspection, still able to lose himself in his art. I was concerned he would displace a hip in Loverboy, but from the ladies’ shouts and hoots, his sacrifice was clearly appreciated! Affable and engaging, Billy Ocean displayed all the traits of a man at ease with himself and the world. As the music rolled on and I watched him sing and dance on the stage, he epitomised the image of the mature individual able to do the things he likes after a long working career. Introducing one of the backing singers as his daughter, part of his motivation was plain to see – the opportunity to perform with one of his children. Here was a man, happy with his own life, who could now impart some of that joy and energy to others, even at sixty four. When he bade farewell, everyone knew he would be back for an encore. Sure enough, he came out to sing two more hits. As the crowd melted, slowly, into the moonlit evening, someone I chatted to expressed the general sentiment: “What an artist. Kim Wilde was good last night, as was Rick Astley, but Billy Ocean was fantastic. At his age, what a show! And what a personality!”
Well done, Billy Ocean, such a testament to what an active senior life should be like!