What can we expect in Portugal and in our Economy in post-Covid19 time?

Portugal reached in 2019 records in the real estate sector and in the capture of foreign direct investment (FSI) never seen. For five consecutive years it is concluded that the total amount invested in the acquisition of real estate will have exceeded 30 billion euros - double the amount observed in 2015 and three times the amount of 10 billion euros recorded in 2012.

More than 250,000 transactions were recorded, with 70% in the residential segment.

Last year, loans to private individuals for the purchase of housing were €10 trillion, but there were more than 50% of purchases made with exclusive capital.

In a pre-covid-19 scenario, the real estate and construction and tourism sectors were identified as two of the three preferred sectors for Portugal's growth and IDE attraction. And in a post-covid-19 scenario, what is going to happen?

Forbes magazine considers Portugal as the best destination to live after the pandemic, and the general opinion is that Portugal will remain attractive or even increase its attractiveness as a destination for investment in real estate.

Of course, this economic crisis is global, but it is not clear that it will affect all countries equally and some may even benefit more than others when it comes to attracting foreign investment.

In the "Ey-attractiveness-survey-portugal-2020" held in May to 300 professionals in the sector, national and international, the opinion is that we will enter a period of contraction, although a recovery between 12 and 24 months is expected.

https://www.ey.com/pt_pt/attractiveness/20/ey-attractiveness-survey-portugal-2020

The results also indicate that the covid-19 effect will not affect all segments equally, with three types of effects:

Permanent or long-term effects on the retail and office segments, with expected demand declines of 30% and 20%, respectively.

Temporary effects, where tourism is estimated to fall by 40% and a 24-month recovery until 2019 levels are reached.

Zero effects in the residential segment, where there will be a change in consumer needs (demand for housing with more area and outside urban centers); and in the logistics and industrial segments, where greater resilience will be observed, in some cases an increase in demand is expected.

Representing Portugal a small percentage of total investment in real estate in Europe (in some segments only 1% of the European total), its geographical position as a strategic point of communication with the United States, Canada and the countries of the South of the American continent, the political and social stability of our country and the security of the national health system, will undoubtedly be some of the factors that will influence the decisions of investors and Portugal will be one of the preferred destinations in the future to a wider and international audience.

Source: https://www.ey.com/pt_pt/attractiveness/20/ey-attractiveness-survey-portugal-2020