MONACO has long been renowned as one of the world’s most supply-constrained luxury real estate markets in the world.
There is, after all, a limit to the amount of property possible on a 2km-square principality.
Which, given its desirability, leaves it with something of a dilemma. Such property, if you can fend off the competition, commands a high price - albeit, once secured, a prized investment.
For UHNWIs, therefore, the big question is where else to look?
Where offers a slice of luxury within the European marketplace, where supply restraints assist a hoped-for solid growth in investment as well as a safe and secure environment with other lifestyle benefits?
Enter Portugal and a luxury new homes market that has emerged as one of Europe’s strongest performers.
According to a recent report by research company Property Market-Index, median property prices in Portugal rose by a staggering 17.9% year-on-year, compared to an EU average of around 5%.
Key regions such as capital Lisbon, Cascais - the premier coastal retreat dubbed the ‘Monaco of Portugal’ - the Algarve, Comporta, and parts of Porto lead the charge.
Unlike Monaco, size is not the problem for Portugal. The constraint is primarily regulatory. Tight planning and infrastructure laws keep high-end developments sparse, while international demand is piling on the pressure.
Explains Danielle Moxey, from Property Market-Index: “International buyers dominate the market, accounting for a substantial share of real estate investment, with strong inflows from the US, UK, France and other international markets.
“Portugal’s tax incentives, Golden Visa residency programmes, and reputation as a safe, high-quality lifestyle destination continue to reinforce this demand.
“Overall, the outlook remains highly positive, with forecast growth is expected to continue in a similar vein in 2026.”
All of which continues to make international investors sit up and take notice.
Paul Stannard is chairman and founder of Portugal Pathways and the Portugal Investment Owners Club which supports UHNWIs navigate their luxury new homes market in Portugal key property hotspots.
He explains: “Portugal is no longer a niche market – it’s an established international destination for residency and investment.
“What we are seeing is UHNWIs, in the likes of Monaco, investing in high-end exclusive new homes and developments. Whether as a bolthole to enjoy the culture and scenery in a nation renowned for its Atlantic coastline, sweeping countryside or vibrant and historic cities, or simply an investment opportunity.
“Given the growth in property values over the last few years, the market growth is clearly there, while planning restrictions and limited supply mean most are snapped up off-plan.
“Increasingly, the real advantage lies in knowing where to look, and how to access the right opportunities at the right time and that where we come in.”
Portugal’s attraction to international wealth has been buoyed by its residency-by-investment Golden Visa programme which has created €9bn in investment and €54bn in wider impact and 30,000 jobs in Portugal.
Designed for eligible non-EU, non-EEA and non-Swiss nationals who make a qualifying investment under Portuguese legislation - most frequently a subscription of at least €500,000 in a regulated investment fund - it has piqued the attention of many.
However, it is worth noting that real estate is no longer a qualifying investment route for a Golden Visa.
International investors frequently seek the Golden Visa not for a permanent move, but for the pathway to residency which it can provide - as well as access to the Schengen area. A jurisdictional flexibility. A Plan B.
For those living in Monaco and pursuing the Portuguese Golden Visa, for example, there is no need to uproot their family or change tax status.
Under current legislation, Golden Visa holders are generally required to spend, on average, just seven days per year in Portugal.