Based on the tourism activity data for February 2024, the Portuguese property market, particularly in the tourist accommodation sector, exhibits robust growth and resilience, making it an attractive prospect for real estate investors. The sector witnessed a significant increase in guests (+7.0%) and overnight stays (+6.4%) compared to the previous year, with total revenue surging by 13.0% and revenue from accommodation alone up by 13.1%. These increases are reflective of a strong demand, especially in regions such as Grande Lisboa and Madeira, where average daily rates reached peak values. Additionally, the sector’s positive performance is despite 2024 being a leap year, suggesting that the growth is not merely a product of extra calendar days but indicative of a genuine upward trend.
On the other hand, investors should consider the nuances of the market. While the overall revenue and occupancy rates are encouraging, there are fluctuations in the number of stays by residents compared to non-residents, with non-residents showing higher growth rates. This implies a heavy reliance on international tourism, which can be susceptible to global economic shifts and travel policies. Furthermore, the slightly declining average stay duration and small dips in occupancy percentages underscore a competitive market environment. Investors should thus approach with a strategy that balances the appeal to both domestic and international visitors, and possibly diversify into niche markets or consider properties that offer mixed-use possibilities to hedge against these variances. This balanced approach will help capitalize on the current market strengths while safeguarding against potential volatilities.
