“Every house tells a story”

“What my team and I do is take a house that someone wants to sell, and find someone else who wants to buy it – someone who really wants to buy it”, without complaining about the deal, or changing their mind. From the outset, this could be the reason for the success of the Portimão-centro branch that opened on 5th January 2009, employs 11 people and oversaw the signing of around 40 property deals in 2010 – in the full throes of the crisis.

Nuno Branco, 43, explains that one needs to understand the dynamics of society to do well in the residential property market. “I often say that this business has very little to do with houses. Almost nothing, in fact. It has to do with people and their problems”, he tells.

“Sellers very often are in difficult financial situations, and need to resolve things quickly and securely. There are those who need to move to a larger house because they’re going to have another child – or those who want to move to a smaller one; or need to change their job, the location where they work. Generally, there’s a very strong necessity. No-one moves house, buys or sells on a whim – unless, perhaps, they’re investors, but that segment really only involves 10 per cent of our business”.

More than 80 per cent of his clients are residents of Portimão (but of all different nationalities) – and the most sought after property is a 3-bedroom apartment.

“But most people’s dream is to own a house”, although it may be out of their price range. A dream for another day?

“Well, that’s normally the case. People tend to start by buying a 2-bedroom apartment” – the typical choice of first-time buying couples.

“Then they buy a 3-bedroom apartment – and then they go for a house. Once they get to 60-65 years of age, their children have moved away from the parental home, to buy their own properties, and when this happens, couples often decide their living space is too big. So then they embark on the reverse process – and usually they look for an apartment near the centre of town”.

Considering Portimão rampant urbanism, we ask Nuno Branco is there aren’t too many houses in his area?

“No, it’s my feeling that we could do with more”, he replies. “When was the last time you saw a building start and be completed – and how long ago was that”, he counter-questions.

Taking as a random example the glass-covered building that recently sprang up alongside the sardine restaurants on the town’s riverside, Nuno Branco made some interesting comments about Portimão’s “parque habitational”.

“That building has been under construction since 2008. We’re talking about a luxury segment of the market – something you just don’t find in Portimão. From what I hear from the promoter, nearly all the units have already been sold.

Surely, in a crisis it would be difficult to sell at the top end of the market?

“Absolutely not! The situation’s actually the reverse! These days, the people with the most access to credit are those with the highest incomes. They’re the people who can give banks the best guarantees, and they’re the last to be affected by the economic crisis”, he explains.

But the average man in the street?

“It’s probably more difficult for someone who earns €1.000 a month to get €100.000 from the bank than it is for someone who earns €5.000 a month to secure a loan of €200-300.000. This is how it goes”.

Until recently “credit was easy, and it was very easy to buy a house. People thought it would always stay that way. But nothing’s eternal – and things change a lot because of the lack of rules over the kind of credits people take out, using their houses as collateral. People use their homes for consumerism: to buy cars, to buy holidays abroad – and right now, when they put their homes up for sale, they’re also selling this aspect. Mortgages don’t correspond to the value of properties”.

Right now, house buying has become a lot more restricted. Banks are picking and choosing the people who qualify for credit. But that’s not to say that houses are not selling. “What I’m saying is that today the market is much more selective”, Branco explains.

“Look, in the majority of cases, this business used to be very badly managed – because it was easy. The professionals in the field didn’t apply themselves sufficiently to do a good job because, if they lost a client, another one would always turn up. These days, that’s all changed. Now we’re at a time when “property mediation” is truly a service that goes all out to resolve the client’s problems,” he guarantees.

But going back to our previous question. Are there too many properties, or not, in Portimão?

“That’s easy. You have to understand the way Portimão’s structuring itself. There are two secondary schools and around seven higher education establishments. They’re all full to bursting. This academic year for instance, the “Escola Secundária Teixeira Gomes” has 22 classes just for the 8th grade – with an average of 28 pupils per class! That means there are a lot of people in town! The population is growing!”

The reality is that there’s a huge market for homes in Portimão. A situation that reduces that number of properties sold is, obviously, the difficulty in securing credit – but that doesn’t mean that people aren’t looking for homes. Numbers continue to remain high”.

It’s no surprise, therefore, that people come into the shop everyday looking for properties to rent. Demand is very high, but “supply” is almost non-existent. Nuno Branco explains this is a “market that doesn’t work” because it’s subject to a “logic” that is unpopular with “tenants just as much as it is with landlords”.

If in the past Portimão was sought-out by those enjoying the luxury of buying a second holiday home, today this is far from the case. “That sector hasn’t dried up altogether but it’s reduced significantly. It’s not high-up on the list” when it comes to the volume of business at ERA’s “Portimão-centro” outlet.

“As a result of the huge contraction suffered within the market, what we have seen is people putting their second homes up for sale – to help pay the mortgage on the properties they live in all the time” and thus reduce their debt with the bank.

“They’re people that used to earn enough for a second home in the Algarve, and who probably now feel that it’s something they don’t need”, he adds.

“It’s a phenomenon that began in 2008”. A sign of the times? Branco shrugs off the question. “The property market is very fluid. It’s always changing”.