After a career in importing vehicles, Luis Corrêa de Barros joined the real estate market and is now the head of Habitat Invest, a real estate investment company that is strongly committed to the rehabilitation of historic city centers, and on the profitability of tourist rentals. Luis Corrêa comments on the remarkable evolution of the Portuguese market in recent years.
Tell us about Habitat Invest’s activities.
Habitat Invest is made up of four companies. Habitat Invest realizes the real estate investments; Habitat Project Management brings together lawyers, engineers, architects and financiers of the group, the team dedicated to the management of group projects; and Habitat Property manages the apartments we sell to investors. Lastly, we are the exclusive partners in Portugal of Patron Capital Partners, a private investment fund that invests through us in the residential market, as well as family offices and private companies. Until 2016 our economic model was centered on tourist rentals. In 2018, we invested 300 million euros in the construction of 8 new projects. We are pioneers of the model guaranteeing profitability through tourism, as well as investment in downtown Lisbon. We have also started investing in residential properties in Lisbon, Porto, Estoril and Cascais, including land for the construction of residential properties.
What do you say to Lisbon residents who criticize rising rents?
This is a false problem. Five years ago, before the city center was rehabilitated, no one wanted to live there, unlike today. The neighborhood was dangerous, you could not walk at night. Today, we can share with all the tourists who come to visit Lisbon a part of our history, of our past. Portugal’s property portfolio is one of the largest in Europe. It’s up to the government to promote more affordable housing, which it thinks it can do. The rest is the normal operation of the market.
Should we expect a more restrictive evolution of legislation, as in Spain?
The Portuguese situation is different. The municipalities and the government do not want to kill the golden goose that represents tourism, which brings a lot of tax revenues to Portugal. The only constraint is to obtain a license for “local housing”, and not tourism, when the building is both intended for housing and tourist rental. However, in order to preserve the authenticity of certain areas of Lisbon, the number of apartments dedicated to tourism as well as the confinement areas in which tourist accommodation is closed has been limited. Municipalities are responsible for analyzing these boundaries.
How do you see the market evolving?
Growth has never been so fast. Today, it is still there, but is less accentuated, which is positive because it prevents the risk of creating a real estate bubble. Today, the lowest prices start to increase while those in the city center stabilize. This better reflects the reality and maturity of the market.