Investing in Capital Cities: Lisbon
Posted by Jude Buttle on Thursday, July 31, 2008
Lisbon has been unkempt and undervalued but now it's under inspection. Is Portugal's capital city finally becoming vogue?
Belém Tower - photo by Bernt Rostad
Fast Facts
Country: Portugal
Population: 564,477
Area: 84.8 km²
Currency: € Euro
Official Language: Portuguese
Telephone Code: +351 21
Location Information
Lisbon is located in the west of Portugal, on the Atlantic Ocean coast, situated at 38°42' north, 9°5' west, making it the westernmost capital in mainland Europe.
The city sits on seven low hills beside the Tejo (Tagus) river and due to its geographic location, was popular with traders and settlers, especially from North Africa and the Middle East.
What's the Attraction?
Lisbon is an ancient and enchanting city, with Moorish influences, an historical old quarter and an array of beautiful sights, including church towers, domes, monuments and museums.
The western side of Lisbon has the wide open spaces of the Monsanto Forest Park, one of the largest urban parks in Europe. Around the centre of the city are wide, tree-lined avenues graced by Art Nouveau buildings, mosaic pavements and street cafes.
As the sun sets, Lisbon's old quarters come alive with the sound of fado singing and guitar-playing - the melancholic, musical expression of the soul of Lisbon's inhabitants.
Long into the night, numerous open-air cafés, bars and discothèques - whose lights are reflected in the calm waters of the River Tagus - are filled with friendly locals and revelling tourists.
The city boasts 20 centuries worth of history, a great climate, is situated conveniently close to the coast and is becoming a popular destination for tourists. So, for those visitors wishing to bask on a beach, or for those seeking a short break and more interested in the culture and architecture of a place, Lisbon offers something for everyone.
Lisbon Architecture
Thanks to its rich history and great power during the Age of Discovery, Lisbon has an eclectic mix of architecture (Romanesque, Gothic and Baroque constructions can be seen all over the city) and is packed with historical, cultural and religious sites.
Many churches and cathedrals pierce the skyline, including the opulent, architectural masterpiece, the Mosteiro dos Jerónimos, which in 1983 was classified as a UNESCO World Heritage Site.
Similarly honoured is the iconic Belém Tower, a fortified tower built in the early 16th century to guard the entrance to Lisbon's harbour. It was often the starting point of the voyages of discovery, as well as the last image sailors would see before they went off into the murky unknown.
Lisbon is also home to over 50 museums, including the Museu Nacional de Arte Antiga (National Museum of Ancient Art) and the Lisbon Oceanarium (Oceanário de Lisboa), which is the largest of its kind in Europe.
Inaugurated in 1959 and resembling the famous Christ the Redeemer statue in Rio de Janeiro, Brazil, the monument Christ the King (Cristo Rei) stands on the left bank of the River Tagus, in Almada.
With open arms and overlooking the whole city, the monument was built after World War II, as gratitude for Portugal being spared the horror and destruction of the war.
Infrastructure & Investment
With the interest in investing in an inner-city property across Europe intensifying, speculators are now turning their attention to Lisbon, attracted by its ambience and affordable prices.
The city had a rundown reputation but with a surge of EU funding and socio-economical development taking place, Lisbon's infrastructure is now better equipped for the attention being shown in its property market. Drains and sewage systems have been modernised, water supplies upgraded, main roads, city streets and pavements all improved, giving it a sense of rebirth.
Plus there's planning for a new airport ready for 2020, designed to cope with the increasing number of low budget airlines flying from all across Europe and in particular the UK.
The Lisbon Property Market
Entry level - If your budget is tight, but you wish to get on the property ladder and like the idea of being able to move around with your house in tow, then a selection of mobile homes might be right up your street.
A 2 bedroom mobile home on the outskirts of Lisbon and located close to beaches and supermarkets is very affordable, costing from just £15,995.
Mainstream - With amazing architecture, Lisbon is ideal if you wish to live in fashionable looking accommodation. A 2 bedroom apartment on the 2nd floor in a typical Pombaline style building, located in the centre of Lisbon, will set you back about £110,000.
Top of the range - If you have the money to be a little extravagant and like period properties, then a 2 bedroom apartment built in the middle of the 18th century in the desirable Alfama area could be just the answer.
A picturesque and inspirational district, Alfama is highly sought after and top of the range 2 bed apartments start here at around £545,995
Rental Potential
Buy to let investments in Lisbon are not as lucrative as they are in the Algarve or the Silver Coast, but rental returns of 5% to 6% are still healthier than most other parts of the country.
The law in Portugal is still strongly pro-tenant, but a new housing law was recently passed - the New Urban Lease Act - in an attempt to tip the balance in favour of the landlord. However, tangible effects of these reforms have yet to be seen.
Conclusion
With more EU funding in the pipeline, tourism on the increase and the improvement in the city's facilities ongoing, many experts expect Lisbon to be ‘hot' soon. So investors are being advised to buy in the near future, before it all boils over.
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