Developed by ILM ■ THR, the 10-10-10 Residential Tourism Survey consists of a quarterly barometer analysis, the objective of which is to evaluate the market’s level of confidence, performance and trends of the tourist real estate sector in Portugal.
This analysis is one of the three initiatives launched by ILM ■ THR during 2008, under the umbrella brand of “Portugal Residential Tourism Market
Intelligence”, which have a common objective – to provide market information, and collecting detailed and updated information on the Residential
Tourism.
For the development of the present analysis, a questionnaire comprising10 questions was submitted to the following Developers and Real Estate Agents - leaders in the national market:
8 Developers:
Norte Golfe Promoções Turísticas e Imobiliárias, S.A. - Porto
Bom Sucesso - Óbidos Empreendimentos Turísticos, S.A. - Óbidos
ORIZON CAMPOREAL S.A. - Óbidos
MSF - TUR.IM, SGPS, S.A. - Lisboa
Newlyn Portugal - Algarve
Pestana Imobiliária - Algarve
Vale do Lobo, Resort Turístico de Luxo, S. A. - Algarve
Grupo Oceânico – Oeste e Algarve
8 Real Estate Agents:
Abacus Savills - Lisboa
Atlantic Estates - Algarve, Lisboa e Costa de Prata
Garvetur - Sociedade de Mediação Imobiliária S.A. - Algarve
IRG International Reality Group - Lisboa
John D Griffiths - Algarve
Prunty\'s Overseas Properties S.A. - Lisboa
Sadlers Mediação Imobiliária - Knight Frank - Algarve
Winkworth - Algarve
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Results Residential Tourism Survey 10 10 10 Feb 2009
1. PORTUGAL RESIDENTIAL TOURISM MARKET INTELLIGENCE
10 10 10
QUESTIONS DEVELOPERS AGENTS
ILM ■ THR
QUARTERLY MONITOR
QUARTER BAROMETER ANALYSIS OF THE PORTUGAL RESIDENTIAL TOURISM MARKET CONFIDENCE
4th QUARTER 2008 vs 1st QUARTER 2009
II L M
LM
INTERNATIONAL TOURISM ADVISERS
II L M
LM
INTERNATIONAL TOURISM ADVISERS
1
Lisbon, 26 February 2009
2. TABLE OF CONTENTS
Introduction 3
1 - Residential Tourism Market Confidence 4
2.1 - Level of business activity - Sales 5
2.2 - Level of business activity – Holiday Rentals 6
3.1 Weight f S l
3 1 - W i ht of Sales per t
typology – A t
l Apartments,Townhouses and Vill
tT h d Villas 7
3.2 - Weight of Holiday Rentals per tipology – Apartaments and Villas 10
4 - Market Interest in the regions of Oeste, Lisboa , Algarve and Porto in the 4th Quarter 2008 12
5.1 - Market Interest in the 4th Quarter 2008, per Country of Origin: Sales 13
5.2 - Market Interest in the 4th Quarter 2008, per Country of Origin: Holiday Rentals 14
6 - Ranking of the buying decision factors for the 4th Quarter 2008 15
7 - Markets that represented a competitive threat to Portugal in the 1st Quarter 2009 16
8.1 - Overall level of confidence in the Portuguese residential tourism market for the 2nd Quarter 2009 – Sales 17
8.2
8 2 - Overall level of confidence in the Portuguese residential tourism market for the 2nd Quarter 2009 – Holiday Rentals 18
9 - Marketing measures that entities are considering to implement on the 1st Quarter 2009 19
10 – Final conclusions ILM ■ THR 20
II L M
LM
INTERNATIONAL TOURISM ADVISERS
3. PORTUGAL RESIDENTIAL TOURISM MARKET INTELLIGENCE
10 10 10
QUESTIONS DEVELOPERS AGENTS
ILM ■ THR
QUARTERLY MONITOR
INTRODUCTION
Developed by ILM ■ THR, the 10-10-10 Residential Tourism Survey consists of a quarterly barometer analysis, the objective of which is to evaluate the
market’s level of confidence, performance and trends of the tourist real estate sector in Portugal.
This analysis is one of the three initiatives launched by ILM ■ THR during 2008, under the umbrella brand of “Portugal Residential Tourism Market
Intelligence”, which have a common objective – to provide market information, and collecting detailed and updated information on the Residential
Tourism.
For the development of the present analysis, a questionnaire comprising10 questions was submitted to the following Developers and Real Estate Agents -
leaders in the national market:
8 Developers:
Norte Golfe Promoções Turísticas e Imobiliárias, S.A. - Porto
Bom Sucesso - Óbidos Empreendimentos Turísticos, S.A. - Óbidos
ORIZON CAMPOREAL S.A. - Óbidos
MSF - TUR.IM, SGPS, S.A. - Lisboa
Newlyn Portugal - Algarve
Pestana Imobiliária - Algarve
Vale do Lobo, Resort Turístico de Luxo, S. A. - Algarve
g
Grupo Oceânico – Oeste e Algarve
8 Real Estate Agents:
Abacus Savills - Lisboa
Atlantic Estates - Algarve, Lisboa e Costa de Prata
Garvetur - Sociedade de Mediação Imobiliária S.A. - Algarve
ç g
IRG International Reality Group - Lisboa
John D Griffiths - Algarve
Prunty's Overseas Properties S.A. - Lisboa
Sadlers Mediação Imobiliária - Knight Frank - Algarve
Winkworth - Algarve
II L M
LM
INTERNATIONAL TOURISM ADVISERS
3
4. PORTUGAL RESIDENTIAL TOURISM MARKET INTELLIGENCE
10 10 10
QUESTIONS DEVELOPERS AGENTS
ILM ■ THR
QUARTERLY MONITOR
1 - RESIDENTIAL TOURISM MARKET CONFIDENCE
CONFIDENCE
1st Quarter 2009 vs 4th Quarter 2008
Residential Tourism Market
Confidence
1st Quarter 2009 vs 4th Quarter 2008
80%
40%
LOW TO AVERAGE
27%
13%
13%
7%
Low
Average Average
Average
Low High
high
Comparing the 1st quarter 2009 with 4th quarter 2008, 13% of the participants in the analysis have classified the market confidence as
low, 40% average low and 27% average.
It is important to highlight that in the perspective of the Developers, the market confidence appears slightly higher when compared with
that of the Real Estate Agents.
Qualitative comments:
Developers:
“Potential clients are insecure and not ready for investment decisions”.
“Media reports and continued bank problems have totally scared people off in investing -- even for those who have the money”.
II L M
LM Real Estate Agents:
“Currently we do not see any difference in perceptions in Q1 when compared with Q4 2008 which was quite depressed”.
INTERNATIONAL TOURISM ADVISERS
4
“We hope that by the Q4 2009 the confidence will return to the market”.
“We predict a market bottom around March - April at which time it will regain strength”.
5. PORTUGAL RESIDENTIAL TOURISM MARKET INTELLIGENCE
10 10 10
QUESTIONS DEVELOPERS AGENTS
ILM ■ THR
QUARTERLY MONITOR
2.1 - LEVEL OF BUSINESS ACTIVITY - SALES
SALES
3rd Quarter 2008 vs 4th Quarter 2008
Level of Business Activity - Sales
3rd Quarter 2008 vs 4th Quarter 2008
69%
69%
SIMILAR
31%
0%
Lower
Similar
Higher
In the opinion of the Developers the level of Business Activity on Sales has been similar in the 3rd and 4th quarters of 2008 whereas the
Developers,
Real Estate Agents consider that the level has been lower for the same period.
Considering the analysis per Region, the participating entities consider that the level of business activity diminished in the Algarve, and
maintained levels in the areas of Lisbon, Porto and Oeste.
Developers:
“Investorsquot; are looking for bargain buys, but we are not prepared to discount to the levels they are looking for.”.
Real Estate Agents:
“Strong deterioration in market conditions from October to end December”.
“The quantity does not express the drop in turnover. We felt a big drop in sales price from Q3 to Q4 2008”.
“We have sold the same number of properties as in Q3 2008 but at lower prices”.
We prices
II L M
LM
INTERNATIONAL TOURISM ADVISERS
5
6. PORTUGAL RESIDENTIAL TOURISM MARKET INTELLIGENCE
10 10 10
QUESTIONS DEVELOPERS AGENTS
ILM ■ THR
QUARTERLY MONITOR
2.2 - LEVEL OF BUSINESS ACTIVITY – HOLIDAY RENTALS
3rd Quarter 2008 vs 4th Quarter 2008
HOLIDAY RENTALS
Level of Business Activity – Holiday Rentals
3rd Quarter 2008 vs 4th Quarter 2008
50%
LOWER
50%
50%
50%
SIMILAR
0%
Lower
Similar
Higher
The holiday rentals is only applicable to 8 of the survey participants and 50% of them consider that the level of business activity was
similar and the remainder that the it was similar.
In the opinion of the Developers, the level of business activity for holiday rentals was similar, whereas the Real Estate Agents consider
that there are indications of a decline in this area.
Analysing the data by Region enables us o conclude that in the Algarve and in Lisbon the level of business activity decreased.
“The Q3 is the high season and the Q4 is low season”.
“Our rentals business in predominantly a Q3 business. We do not expect to see strong rentals in Q4”.
II L M “The clients generally book, concentrate on summer holiday rental and first 2 months”.
LM
INTERNATIONAL TOURISM ADVISERS
6
7. PORTUGAL RESIDENTIAL TOURISM MARKET INTELLIGENCE
10 10 10
QUESTIONS DEVELOPERS AGENTS
ILM ■ THR
QUARTERLY MONITOR
3.1 – WEIGHT OF SALES PER TYPOLOGY - APARTAMENTS
Sales activity in the 4th Quarter 2008
y
The apartment supply is lower for typologies T0 and T4.
APARTMENTS
A significant part of the apartment sales was of typology T2 with 33%,
T0 T1 T2 T3 T4
followed by the T3 which represented 18% of the business activity.
Developers 15.3% 15.1% 33.0% 18.6% 5.4%
Comparing the opinions of Developers with the Real Estate Agents
the distribution of the business activity is similar, except for the T0
Real Estate
typology. This may be justified by different sales and marketing 5.5% 11,5% 38.1% 27.4% 2.3%
Agents
approaches.
Trend of sales in the 1st Quarter
2009 - Apartments
Trend of sales in the 1st Quarter 2009 - Apartments
According to the participants, the trend of the sales activity will be
similar.
Similar
Decrease
Increase
I
Not Applicable
T0 T1 T2 T3 T4
II L M
LM
INTERNATIONAL TOURISM ADVISERS
7
8. PORTUGAL RESIDENTIAL TOURISM MARKET INTELLIGENCE
10 10 10
QUESTIONS DEVELOPERS AGENTS
ILM ■ THR
QUARTERLY MONITOR
3.1 - WEIGHT OF SALES PER TYPOLOGY - TOWNHOUSES
Sales activity in the 4th Quarter 2008
y
TOWNHOUSES
The behaviour is very similar in the opinion of all the participants.
TH2 TH3 TH4
We see that the business generated with Townhouses (TH) of 2
bedrooms is significant because, despite the average prices being
21.3%
21 3% 24.5%
24 5% 14.0%
14 0%
Total
Ttl
lower than TH3, the generated volume is very similar between them.
Developers 22.1% 26.3% 11.7%
Real Estate Agents 20.0% 21.3% 17.5%
Trend of sales in the 1st Quarter 2009 - Townhouses
Trend of the Townhouses sales in the 1st
“There is less demand for Townhouses when compared with previous
years”. The trend of the activity level for the Townhouses is likely to be Quarter 2009
similar or to decrease.
Especially in the case of Townhouses of 4 bedrooms it is more certain
that there will be even less demand for this product.
The opinions of the Real Estate Agents and the Developers coincides. Similar
Decrease
Increase
Not Applicable
TH2 TH3 TH4
II L M
LM
INTERNATIONAL TOURISM ADVISERS
8
9. PORTUGAL RESIDENTIAL TOURISM MARKET INTELLIGENCE
10 10 10
QUESTIONS DEVELOPERS AGENTS
ILM ■ THR
QUARTERLY MONITOR
3.1 - WEIGHT OF SALES PER TYPOLOGY - VILLAS
Sales activity in the 4th Quarter 2008
y
VILLAS
Once again the opinions are similar among all the participants.
V2 V3 V4 V5
The typology V2 is of minimal importance. The figures for V3 and V4
Total 10,5% 33.0% 31.9% 11.3%
are particularly significant.
Developers 7.0% 31.8% 34.4% 11.3%
Real Estate Agents 0.0% 23.3% 47.5% 16.0%
Trend of sales in the 1stt Quarter 2009 - Villas
Trend of sales in the 1st Quarter 2009
A higher volume of villa sales is foreseen for a price positioning at the - Villas
high end of the market.
The trend of villas sales in the near future is positive and there is a
perception of improvement for V3 and V4.
Moreover, we can observe that the Real Estate Agents are more
positive than the Developers for this product in the 1st quarter 2009. Similar
Decrease
Increase
Not Applicable
II L M
LM V2 V3 V4 V5
INTERNATIONAL TOURISM ADVISERS
9
10. PORTUGAL RESIDENTIAL TOURISM MARKET INTELLIGENCE
10 10 10
QUESTIONS DEVELOPERS AGENTS
ILM ■ THR
QUARTERLY MONITOR
3.2 - WEIGHT OF HOLIDAY RENTALS PER TYPOLOGY- APARTMENTS
Holiday Rentals activity in the 4th Quarter 2008
y y
APARTMENTS
There is not enough information to evaluate the holiday rentals activity
for the Real Estate Agents. T0 T1 T2 T3 T4
Total
We can identify that the major part of the demand, at least in this
y jp , 10.0% 35.0% 40.7% 11.7% 10%
season, is positioned in apartments T1 and T2. This is different to
Developers
sales, which are more active for the T2 and T3. 10.0% 35.0% 45.0% 11.7% 10%
Real Estate
“The demand of T2 has increased for the golf market”
N.A. N.A. N.A. N.A. N.A.
Agents
“The situation is similar with the transition of 2007 to 2008”
Trend of holiday rentals in the
1st Quarter 2009 - Apartments
Trend of holiday rentals in the 1st Quarter 2009 - Apartments
The trend is clearly to increase the business activity of holiday rentals
rentals,
which is normal considering that the 1st Quarter of the year usually
has more activity.
Similar
The current business forecast does not necessarily mean that the
movement will be reflected in the occupancy rates for the 1st Quarter. Decrease
On the contrary we know that the bookings made by the British
contrary,
Increase
market are for the summer season and are traditionally prepared at
this time of the year. Not Applicable
T0 T1 T2 T3 T4
II L M
LM
INTERNATIONAL TOURISM ADVISERS
10
11. PORTUGAL RESIDENTIAL TOURISM MARKET INTELLIGENCE
10 10 10
QUESTIONS DEVELOPERS AGENTS
ILM ■ THR
QUARTERLY MONITOR
3.2 - WEIGHT OF HOLIDAY RENTALS PER TYPOLOGY - VILLAS
Holiday Rentals activity In the 4th Quarter 2008
y y
VILLAS
It is interesting to verify that villa holiday rental activity has a higher
impact on the Real Estates Agents’ income than that of the Algarve V2 V3 V4
Developers.
3.75
3 75 % 28.75
28 75 % 62.5
62 5 %
Total
The possible reasons for this situation are:
7.5 % 11.7 % 10 %
Developers
• Higher loyalty rate of the clients – there is not enough historical data
in the case of the recent resorts. Real Estate Agents 32.5% 62.5%
Na
• More consolidated distribution channels.
• Larger diversity of product supply.
Trend of holiday rentals in the 1st
Quarter 2009 - Villas
Trend of holiday rentals in the 1st Quarter 2009 - Villas
According to the participants, the trend for the level of activity is to be
maintained.
Similar
Decrease
Increase
I
Not Applicable
T0 T1 T2 T3 T4
II L M
LM
INTERNATIONAL TOURISM ADVISERS
11
12. PORTUGAL RESIDENTIAL TOURISM MARKET INTELLIGENCE
10 10 10
QUESTIONS DEVELOPERS AGENTS
ILM ■ THR
QUARTERLY MONITOR
4 - MARKET INTEREST IN THE REGIONS OF OESTE, LISBOA , ALGARVE AND PORTO IN THE 4th
Quarter 2008
th Quarter 2008 and trend for the 1st Quarter 2009
4
WEAK INTEREST WITH TREND TO BE SIMILAR OR EVEN TO
DECREASE.
DECREASE
LISBOA
STRONG INTEREST WITH TREND TO BE SIMILAR.
WEAK INTEREST WITH TREND TO BE SIMILAR OR EVEN
INCREASE.
PORTO
STRONG INTEREST WITH TREND TO INCREASE.
II L M
LM
INTERNATIONAL TOURISM ADVISERS
12
13. PORTUGAL RESIDENTIAL TOURISM MARKET INTELLIGENCE
10 10 10
QUESTIONS DEVELOPERS AGENTS
ILM ■ THR
QUARTERLY MONITOR
5.1 – MARKET INTEREST IN THE 4th QUARTER 2008, PER COUNTRY OF ORIGIN: SALES
BENELUX
PORTUGAL ENGLAND IRELAND SPAIN SCANDINAVIA GERMANY
INTEREST
INTEREST WEAK WEAK INTEREST SIMILAR SIMILAR
BETWEEN
BETWEEN INTEREST INTEREST BETWEEN INTEREST WITH INTEREST
SIMILAR
SIMILAR WITH TREND WITH TREND SIMILAR AND TREND TO BE WITH TREND
AND WEAK
AND WEAK TO BE SIMILAR TO BE SIMILAR STRONG SIMILAR.
SIMILAR TO BE
WITH TREND
WITH TREND OR DECREASE OR WITH TREND SIMILAR.
TO BE
TO BE DECREASE. TO BE
SIMILAR.
SIMILAR. SIMILAR.
The interest of the market revealed for France and the Eastern Europe countries during the 4th Quarter 2008 varied from weak to similar and its trend for
h
the 1 st Quarter 2009 is to be similar.
The interest of the market revealed by Russia during the 4th Quarter 2008 varied between the weak and the strong and its trend for the 1st Quarter 2009 is
to be similar.
OTHER COUNTRIES AND REGIONS ARE BECOMING INTERESTED IN AQUISITION OF PROPERTIES IN
PORTUGAL:
SAUDIT ARABIA , POLAND, CENTRAL AFRICA, TURKEY,
II L M
LM
VENEZUELA, AUSTRALIA, BRAZIL, GUATEMALA.
INTERNATIONAL TOURISM ADVISERS
13
13
14. PORTUGAL RESIDENTIAL TOURISM MARKET INTELLIGENCE
10 10 10
QUESTIONS DEVELOPERS AGENTS
ILM ■ THR
QUARTERLY MONITOR
5.2 - MARKET INTEREST IN THE 4th QUARTER 2008, PER COUNTRY OF ORIGIN: HOLIDAY RENTALS
BENELUX
PORTUGAL ENGLAND IRELAND SPAIN SCANDINAVIA GERMANY
SIMILAR OR
INTEREST SIMILAR SIMILAR WEAK SIMILAR SIMILAR
WEAK
BETWEEN INTEREST OR INTEREST INTEREST INTEREST WITH INTEREST
INTEREST
SIMILAR AND WEAK WITH WITH TREND WITH TREND TREND TO BE WITH TREND
WITH TREND
STRONG WITH TREND TO TO BE SIMILAR TO BE SIMILAR TO INCREASE
TO BE
TREND TO BE DECREASE OR OR INCREASE SIMILAR .
SIMILAR.
SIMILAR OR BE SIMILAR
DECREASE
The interest of the market shown for the Eastern Europe countries during the 4th Quarter 2008 varied between the similar and the weak and its trend for
the 1st Quarter 2009 is to decrease or to be similar.
The interest of the market shown for France during the 4th Quarter 2008 was weak and its trend for the 1st Quarter 2009 is to be similar.
The interest of the market shown for Russia during the 4th Quarter 2008 was weak and its trend for the 1st Quarter 2009 is to be similar or to increase.
II L M
LM
INTERNATIONAL TOURISM ADVISERS
14
15. PORTUGAL RESIDENTIAL TOURISM MARKET INTELLIGENCE
10 10 10
QUESTIONS DEVELOPERS AGENTS
ILM ■ THR
QUARTERLY MONITOR
6 - RANKING OF THE BUYING DECISION FACTORS FOR THE 4th QUARTER 2008
Developers and Real
RANKING
Developers Real Estate Agents Estate Agents
Factors Average Ranking Average Ranking Average Ranking
Product price
p 5 7 7 2 6 3
1.
1 GENERAL MARKET CONFIDENCE
General market confidence 1
7 1 9 1 8
Currency exchange 7 2 7 3 7 2
2. CURRENCY EXCHANGE
Primary value source market 6 5 5 6 5 7
Range of residential products on 3. PRODUCT PRICE
offer 7 2 4 9 5 6
Ease of travel to the nearest 4. CLIMATE
international airport
it ti li t 5 9 5 8 5 8
Ease of travel to the site(s) location 4 10 5 6 5 9 5. OTHER(S)
Climate 6 5 6 4 6 4
6. RANGE OF RESIDENTIAL PRODUCTS
Security 5 8 4 9 5 9
Other(s) 6 4 5 5 6 5 ON OFFER
7.
7 PRIMARY VALUE SOURCE MARKET
8. EASE OF TRAVEL TO THE NEAREST
INTERNATIONAL AIRPORT
Other factors mentioned were:
9. SECURITY EASE OF TRAVEL TO THE
- Availability of mortgages at competitive rates SITE(S) LOCATION
()
- Property location – i.e. distance from beach, golf, etc
II L M
LM
INTERNATIONAL TOURISM ADVISERS
15
16. PORTUGAL RESIDENTIAL TOURISM MARKET INTELLIGENCE
10 10 10
QUESTIONS DEVELOPERS AGENTS
ILM ■ THR
QUARTERLY MONITOR
7 - MARKETS THAT REPRESENTED A COMPETITIVE THREAT TO PORTUGAL IN THE 1st
QUARTER 2009
Traditional markets Total Average Ranking
RANKING
Spain 39 3,5
35 1
France 34 2,8 2
1. SPAIN
Emergent markets Total Average Ranking 2. FRANCE
Cyp us
Cyprus 22 2,2
, 4
3. TURKEY
Turkey 28 3,1 3
Greece 22 2,4 4
4. CYPRUS AND GREECE
Bulgary 14 1,6 8
5. USA AND CARIBBEAN
Malta 14 1,8 8
6.
6 DUBAI
7. MOROCCO AND NORTH AFRICA
Other markets Total Average Ranking
Morocco and North Africa 18 2,3 7
8. BULGARY AND MALTA
USA and Caribbean 21 2,9 5
PALOP's 11 1,4 9 9. PALOP´S
Dubai
bi 19 2,4 6
II L M
LM
INTERNATIONAL TOURISM ADVISERS
16
17. PORTUGAL RESIDENTIAL TOURISM MARKET INTELLIGENCE
10 10 10
QUESTIONS DEVELOPERS AGENTS
ILM ■ THR
QUARTERLY MONITOR
8.1 - OVERALL LEVEL OF CONFIDENCE IN THE PORTUGUESE RESIDENTIAL TOURISM
MARKET FOR THE 2nd QUARTER 2009 - SALES
Level of Confidence in the Portuguese
SALES
Residential Tourism Market ‐ Sales
2nd Quarter 2009
LEVEL OF CONFIDENCE
33% 33%
66%
13%
13%
FROM WEAK
7%
AVERAGE TO
AVERAGE
Lower
Average
Higher
It is important to highlight that in the 2nd Quarter 2009, the Real Estate Agents have shown more confidence on the market that the
Developers.
“I think we will continue to see lower volumes of transactions in Q2 although it should show a slight improvement over Q1”
“Good year ahead”
“The clients are there. We need to make them special and create confidence in the products”.
“We have already seen a very strong demand from the local market for our products and we are expecting a number of sales. Due to
current economic crisis we do not expect a good financial year The Q3 and Q4 may look better but Q2 will be poor given feedback and
crisis, year. better,
II L M comments from clients. I think that it is very difficult to preview the next months. Unfortunately, we are depending on a global economy.”
LM
INTERNATIONAL TOURISM ADVISERS
“We are assisting to an increase on the demand of fractionals.“ 17
18. PORTUGAL RESIDENTIAL TOURISM MARKET INTELLIGENCE
10 10 10
QUESTIONS DEVELOPERS AGENTS
ILM ■ THR
QUARTERLY MONITOR
8.2 - OVERALL LEVEL OF CONFIDENCE IN THE PORTUGUESE RESIDENTIAL TOURISM MARKET
FOR THE 2nd QUARTER 2009 – HOLIDAY RENTALS
HOLIDAY RENTALS
Level of Confidence in the Portuguese
LEVEL OF CONFIDENCE
Residential Tourism Market ‐ Holiday Rentals
2nd Quarter 2009
37,5%
37,5%
37,5 %
FROM AVERAGE
12,5%
WEAK TO AVERAGE
12,5%
AND 37 5% AVERAGE
37,5%
0,0%
STRONG
Lower
Average
Higher
The holiday rentals is applicable only to half of the participant entities – 5 Developers and 3 Real Estate Agents.
The Developers estimate a level of confidence higher than that anticipated by the Real Estate Agents.
Qualitative comments:
Developers:
The market conditions may improve in the 2nd Quarter 2009.
Real Estate Agents:
“The rental business is driven by UK holiday clients therefore, considering economic crisis and the valuation of the euro in relation to the
y y g
pound, we believe it will be a slow year.”
II L M
LM
INTERNATIONAL TOURISM ADVISERS
18
19. PORTUGAL RESIDENTIAL TOURISM MARKET INTELLIGENCE
10 10 10
QUESTIONS DEVELOPERS AGENTS
ILM ■ THR
QUARTERLY MONITOR
9 - MARKETING MEASURES THAT ENTITIES ARE CONSIDERING TO IMPLEMENT ON THE 1st
QUARTER 2009
“Increase our presence in new markets and keep investing in marketing and communication. We are increasing the investment in direct marketing
(database)”
“We are keeping our marketing budget for the Q2. We will focus on promotion of the website to target broader potential client base with a focus on
European countries. Translation of website in other languages and promotion through agents in other countries. We are investing on local promotion as
19% of clients are generated locally and develop promotions targeted to Developers”.
“Continued promotion in top of the range magazines to focus on top end market”.
“Training staff to ensure they are fully able to deal with the issues, concerns of buyers and vendors alike”.
“Reinforcing the internet marketing hard sales training agents network and private shows to potential clients ”
Reinforcing marketing, training, clients.
“Our Marketing costs have been reduced in Portugal but have been similar to the UK with advertising on Sunday Times, Telegraph and relevant web
sites. We are opening new offices and participate in exhibitions.”
“Our objective is to create loyalty with customer. Increase the focus on the luxury lifestyle buyers adapting our marketing to the demand. We are focusing
more on events and less focus on printed material more into web marketing, increasing the quality of the information available on the web site.”
“We are minimizing marketing expenses and sale operation costs. We are redefining sales & marketing strategy and re-evaluating product range and
price payment terms conditions.. We will follow up and evaluate closely development of market conditions in Portugal, UK and Ireland.”
“We are concentrating our Marketing efforts on the Portuguese market as we have seen an increase in demand from the local market. We are
establishing partnerships with local agent to promote developments. We are investing in internet advertising in Portugal, outdoor advertising and install on
site sales office
“We are implementing marketing actions in Ireland and the UK will be more focused on personal contact with the client and networking to boost consumer
confidence and gain trust through building a client relationship and bringing the clients to Portugal on inspection trips. We are establishing partnerships
with the Russian market with local agents.“
II L M
LM
INTERNATIONAL TOURISM ADVISERS
19
20. PORTUGAL RESIDENTIAL TOURISM MARKET INTELLIGENCE
10 10 10
QUESTIONS DEVELOPERS AGENTS
ILM ■ THR
QUARTERLY MONITOR
10. FINAL CONCLUSIONS ILM ■ THR
There are no doubts that the world economic crisis affected the national real estate market and strongly hit the confidence, firstly of the Real
Estate Agents and followed by the Developers.
The entities consulted in the scope of the present analysis pointed out a recovery of the confidence on the 4th Quarter 2009, being
perceptible a significant increase on the following Quarter (April to June), mostly conducted by the Real Estate Agents as a result of the
direct contact they maintain with the demand.
Regarding the level of activity, if in the perspective of the Real Estate Agents there has been a decrease on the sales volume, in the
perspective of the Developers this has been similar and there has been identified a slight descendent on the prices, as a more visible
consequence of the economic crisis.
The analysis of the volume of sales per mix of supply enables to highlight that the more demanded typologies of apartments and
townhouses were 2 and 3 bedrooms and it is foreseen that this situation is going to be similar. In the case of villas, the situation is slightly
different,
different being predominant the interest of the typologies V3 and V4 which tends to increase Moreover it is important to point out that
V4, increase.
regarding the demand for villas, the real estate agents are more optimistic that the developers.
Generally we can conclude that the interest of the market is more sensible to the economic instability in the national regions where the
THE 2ND tourist real estate is more developed - Algarve and Oeste. According to the consulted entities, these regions registered a weak interest of
the demand with trend to maintain or increase in the Algarve and maintain or decrease in the Oeste.
O 2º TRIMESTRE
QUARTER 2009
In the regions of Lisboa and Porto the interest of the market tends to be remain strong.
g g
MAY 2009 DEVEA
DE PRESENT
Analyzing the demand by countries of origin, the demand of countries such as Portugal, Spain, Germany, Scandinavia and Benelux tend to
APRESENTAR
SLIGHT maintain the interest on the national residential tourism market. Opposite to the demand of the markets in England and Ireland that present
a weak interest with trend to decrease, as consequence of the strong impacts that reached the economies of those countries. It is important
UMA LIGEIRA
IMPROVEMENT
to emphasize that this difference will be more sensed in the national market in relation to the markets of England and Ireland, in face of the
MELHORIA
WHEN strong dependence of Portugal to this two countries as great incoming markets of residential tourism.
COMPARANDO It is curious to verify the growing interest of demand by emergent markets such as Saudi Arabia, Poland, Central Africa, Turkey, Venezuela,
COMPARED
Australia, Brazil and Guatemala.
WITH THE1º ST
COM O 1
In the basis of changes on the demand of residential tourism may be, besides the economic constraints, factors related with the competitive
TRIMESTRE
QUARTER 2009 supply of emergent countries such as Turkey, Cyprus or Greece, which are countries considered by the developers and real estate agents
consulted on this analysis as true competitive threats to Portugal.
In a period of market stability factors such as the climate the security occupy the first positions in a ranking of the buying decision factors
stability, climate,
II L M of a tourist residential unit. However, on the period of analysis, those factors are drastically surpassed by factors such as the general
LM market confidence, currency exchange and product price.
INTERNATIONAL TOURISM ADVISERS
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21. ILM, celebrating its 10th anniversary of consolidated development, was founded in 1999 by Andrew Coutts with the
objective to render a service of strategic consultancy in tourism, hospitality and leisure for the national market. In
these 10 years of experience, ILM has grown organically and has evolved to the point of currently occupying a leading
position in tourism consultancy. Oriented by the market and by innovation, ILM’s mission is to actively contribute to
the sustained development of the national hotel and tourism sectors, being the only independent consultancy
company specialized in the development and implementation of residential tourism projects.
Through ILM, several important structural projects were developed in Portugal, such as the Identification and
Business Planning of the 10 Strategic Tourism Products defined in the PENT ‐ National Strategic Plan for Tourism NSPT,
g g g ,
and landmark projects for Portugal as a quality tourism destination, namely Praia Del Rey Marriott Resort, Hilton
Vilamoura, Conrad Quinta do Lago or Corte Velho by Six Senses.
The development of the PENT project, in partnership with THR, gave rise to the establishment of the official strategic
partnership with ILM THR Advisors in 2006 THR was founded in 1985 by Eulogio Bordas its current President
ILM‐THR 2006. Bordas, President.
Starting its activity in Spain, THR renders its services all over the world, being referenced in EMEA as the major
company of its category and so being permanently sought by companies and governments of various countries as
well as by international institutions such as the European Union (EU) and the World Tourism Organization (UNWTO).
Praça Duque de Saldanha, Edifício Atrium Saldanha 10º J • 1050-094 Lisboa • Portugal
II L M
LM Tel.: (+351) 213 145 481 • Fax: (+351) 213 145 482 • e-mail: acastro@ilm-portugal.com
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www.ilm-portugal.com
22. II L M
LM
INTERNATIONAL TOURISM ADVISERS
Praça Duque de Saldanha, Edifício Atrium Saldanha 10º J • 1050-094 Lisboa • Portugal
Tel.: (+351) 213 145 481 • Fax: (+351) 213 145 482 • e-mail: acastro@ilm-portugal.com
www.ilm-portugal.com
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LM
INTERNATIONAL TOURISM ADVISERS
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