Luxury Real Estate

By Ole Jespersen of IRG International Realty Group

The Market Situation

Ole Jespersen, sole owner of IRG International Realty Group, says: “At every function - private or business - I am being asked about the market situation. This is not new or as a result of the present economic situation, but also happens in the good times. People like to hear about the property market as it is a topic that actually interests the majority of people. The simple fact is, the property market is the most influential factor for the private, national and the international economies. Just remember what started the ongoing situation: American sub prime lending.

IRG is in a unique situation to comment on the ongoing property financial trends and effects as we are not just a local Portuguese firm, but through our international affiliations and networks we receive constant information and updates from around the world. Within Portugal we are represented in key areas such as the Algarve, the Blue Coast, the Silver Coast and Estoril/Cascais & Sintra as well as Lisbon city. We are involved in normal brokerage (single properties mainly for private buyers) and the institutional and development market with resorts, hotels, residencies and golf courses.

We have for some years published an annual report on the Luxury Residential Tourism Market. The report has become a “reference work” within its area and is statistically based on historical factual figures. The report for this year will be published in May. The following comments are therefore based on observations and personal experiences.

Yes, the market is tough and has seen downward trends in specific sectors. Hardest hit is the low to middle market with especially off-plan, speculative apartment acquisitions. High debt financed purchases have become very scarce with banks no longer being willing lenders and this has had a severe overall effect for developers.

But still, prime locations, prime quality or landmark properties are still in demand. Yes, DEMAND. We are transacting a number of high profile properties in all key areas such as Quinta do Lago, Estoril, Cascais including Quinta da Marinha and Quinta Patino as well as some central Lisbon properties. Some deals are land, some deals are renovation properties and some are brand new, high quality villas and luxury apartments. We represent a number of high value, high quality, prime location residence projects where we are taking substantial reservations - even in this market.

Additionally we also have a number of clients waiting, waiting for THE deal or a distressed sale, but in the high end of the market there is still resilience to "vulture" price cuts. The market has stayed pretty stable which means transaction numbers have been reduced as buyers in general expect "deals". Most transactions also involve lengthy negotiations involving legal, tax and financial issues.

At IRG we are not just sitting it out. We are proactive, we are diligent and flexible and we adapt. And finally we try to create solutions for our clients - be it buyer or seller. For our institutional and development clients we are advising on new activities in the markets internationally and we are constantly working on new approaches to product, marketing and PR. We want to sell real estate as real estate is the catalyst for turning the markets.

Based on the above we will announce shortly a number of new business initiatives running alongside our main property mediation business. These initiatives will be an additional service for all our clients and will reflect our overall aim to be of service and to find solutions for our valued clients.

At IRG we are not pessimists - at the moment we are cautious optimists and we see great potential in the future. We always have to remember we are based in Portugal - the most ideal location for European short and long term holidaying, for the second home or for a change in life. Portugal has everything going for it. So let's make it happen together”.

About IRG International Realty Group

IRG International Realty Group is one of the leading international brokerage companies in Portugal and specializes in sales of Portuguese high-end and luxury residential real estate. IRG is the exclusive affiliate in Portugal of Christie’s Great Estates, a worldwide real estate network and subsidiary of the world’s oldest auction house, Christie’s. IRG’s Head Office is located in the prestigious Avenida da Liberdade in the heart of Lisbon and there are also boutique offices in Quinta do Lago in the Algarve, Estoril and in Kensington, London, United Kingdom.

www.irgportugal.com

By Carina de Sousa  of IRG International Realty Group

IRG International Realty Group: Trends in Luxury Real Estate Market

Faced with the current global economical stand-still there are many voices expressing concerns and opinions on the matter as well as doubts as to how and when this cycle will finally have its end.

However, this crisis that is having its repercussions in most areas of business has propelled many companies and/or private investors to look for ways to compensate losses by investing outside their usual areas of business, specifically into one that is apparently unaffected by this crisis: Luxury Real Estate.

The demand for luxury items and services still surpasses the offer but in Real Estate, the usual investors are attentive and on the look out for trends and signs that can justify action on their part. But it is this inflow of new potential buyers that will keep this market unaffected and maybe still have an influence on its growth.

As far as luxury residential tourism is concerned Portugal has excellent product on offer that is more than capable of competing with the traditional luxury real estate markets from southern Europe.

Top construction quality, architecture and prime, exclusive after sales services are determinant factors in these capitalists’ assessments of the deals, and the latter is the one that will destine 2nd buys and produce the kind of reputation that will generate the brokerages further income. Once these gain the insight into the power of client satisfaction, the industry in general will certainly reap the benefits as will the buyers in particular.

In difficult times such as these, investing in luxury real estate seems to be the safest bet that can be made.

What is new in home design, travel, fashion, dining and entertaining trends?

Both style and lifestyle trends will inevitably vary depending to each individual’s concept, target and location but in fashion and interior design for example are the finishes and materials that fall in and out of favor.

Especially in the current economically challenged times, clients’ favorability will almost always rely on durability and cost, not neglecting also the environmental factor. Even for clients in the luxury segment, whereas before an haute couture, top designer dress might only be worn once, today we see examples being set by some of the royal families in Europe where they have made the decision to boast the same piece in more than one occasion.

Looking at the lifestyle side of things, when it comes to dining out, in Portugal as in most southern European countries the trend is natural and the key word is without a doubt Organic. People look for the natural flavor of the ingredients and more than ever care about the origin of the same. Great consideration is given to the choice of restaurant before venturing out and people nowadays have a tendency to opt for Mediterranean style cuisine over the previously favored ethnic restaurants such as Indian, Chinese, Thai, etc., unless they have specifically heard a great revue on a particular one.

According to a study conducted by Deloitte, New Zealand is a travel destination that is becoming increasingly popular with the majority of its visitors originating from Australia, UK, USA and Japan. The same study also concluded that the demand for fashion hotels has also escalated mostly due to the scheduled openings of Versace, Armani, Missoni and Moschino hotels.

In Portugal, the Algarve is by far the destination of choice and with such great weather and luxury accommodation, those that previously would have chosen other exotic prime destinations, now see this region as a safer and cheaper option with the same and sometimes superior exclusive standards they would find anywhere else in the world. The islands of Madeira and Porto Santo are also among the favourites for exactly the same reasons.

By John Brian Losh

Meghan Barry and I just did a 5-day sweep through Central Florida, visiting several of our prominent members on both the Gulf Coast and the Atlantic Coast. The prevailing feeling is that prices have stabilized and there are, at this time, homes in all categories to be purchased. If you or any of your customers have ever even thought of owning a home in Florida, the time to visit and purchase is now. I believe that the next selling season will bring increased prices and less inventory. I cannot emphasize enough that the time to view and purchase real estate in Florida is now. We are in a very unique time in history where we have low prices, low interest rate and diverse inventory. The perfect opportunity. Visit the Florida Regional Section (www.luxuryrealestate.com/florida) to view property.

Editor’s Note:
John Brian Losh is the CEO/Publisher of LuxuryRealEstate.com and the President, CEO and Broker of Ewing & Clark, Inc. in Seattle. He tirelessly trots the globe meeting with members of LuxuryRealEstate.com and getting the scoop on industry trends. Great stuff.