Is buying a property in Belém a good investment?

Last updated on December 29, 2023

Yes, the analysis of Lisbon's property market is included in our pack

If you've appreciated the historic landmarks and cultural significance in Belém, you may contemplate living in this Lisbon district.

Is it a good idea though? What's the current state of the real estate market in that area? Are property values appreciating or depreciating? Are investors seeing returns on their real estate investments? How's the demand for rentals?

We'll answer all these questions for you! When building and updating our property pack for Portugal, our team has been researching and surveying this area. In fact, there is significant customer interest in investing there. Therefore, we believe it would be beneficial to include some information about it in our property pack.

Why do property buyers like investing in Belém?

Belém, nestled in the heart of Lisbon has carved out a distinctive niche in the property market, drawing in a diverse range of buyers with its unique charm and historical significance.

What sets Belém apart from other areas in Lisbon, and indeed other real estate markets, is its rich blend of cultural heritage, iconic landmarks, and a tranquil yet vibrant atmosphere.

This district is home to the famous Jerónimos Monastery and the Belém Tower, both UNESCO World Heritage Sites, offering a living experience steeped in history unlike any other.

It was around the early 2000s that Belém began to gain popularity as a prime location for property investment. This surge in interest was largely due to the revitalization of its waterfront and cultural scene, making it an increasingly attractive option for those looking to invest in real estate.

Unlike the more bustling areas of Lisbon, such as Baixa or Chiado, Belém offers a more laid-back lifestyle, appealing particularly to those who appreciate a blend of historical charm and modern living.

The demographic that Belém attracts is quite diverse. It's a magnet for culture enthusiasts, history buffs, and those who seek a serene yet culturally rich living environment.

Expatriates, retirees, and even young professionals find the area appealing, drawn by its museums, gardens, and the famed Pastéis de Belém, a local culinary delight. The presence of international schools and easy access to Lisbon's center also makes it a favorable choice for families.

However, every rose has its thorns, and Belém is no exception. One of the potential drawbacks of living in Belém is the tourist influx, especially during peak seasons, which can lead to crowded streets and a somewhat busy atmosphere.

Additionally, property prices in Belém tend to be higher compared to other suburbs of Lisbon, reflecting its desirability but also potentially limiting its accessibility to a broader market.

Lastly, while the area is well-connected by public transport, the traffic congestion during rush hours can be a point of frustration for residents.

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Why is Belém a nice place to live?

Belém offers a living experience that is both unique and highly sought after, the lifestyle in Belém is characterized by a harmonious blend of historical richness and modern convenience.

This area is renowned for its cultural landmarks like the Jerónimos Monastery and Belém Tower, which infuse daily life with a sense of history and beauty.

The culture here is vibrant, with numerous museums, galleries, and cultural events that keep the spirit of Lisbon alive and thriving.

For expatriates, Belém is particularly appealing. The expat community in this part of Lisbon is growing, thanks in part to the area's tranquility, cultural offerings, and the availability of international schools.

Such as St. Julian's School and the Carlucci American International School of Lisbon. These institutions not only provide quality education but also foster a sense of community among expat families.

In terms of living costs, Belém sits on the higher end of the spectrum in Lisbon. The cost of living here reflects its status as a desirable and upscale area, with property prices and daily expenses being somewhat higher than in other parts of the city.

However, many find that the quality of life, the cultural offerings, and the picturesque surroundings justify the extra cost.

Safety is a key consideration for any prospective resident, and Belém scores well in this regard. It is generally considered a safe area, with lower crime rates compared to more bustling parts of Lisbon. This sense of safety adds to its appeal, especially for families and those looking for a peaceful living environment.

Regarding amenities and facilities, Belém is well-equipped. Hospitals such as Hospital Egas Moniz provide quality healthcare services.

Shopping enthusiasts will enjoy Centro Comercial de Belém, which offers a range of shops and eateries. The area is also dotted with quaint cafes and restaurants, providing a delightful culinary experience.

The quality of infrastructure in Belém is commendable. The roads are well-maintained, and utility services like electricity and water supply are reliable. Internet connectivity is generally strong, a crucial factor for expats and professionals working remotely.

Accessibility is another of Belém's strengths. It's well connected to other parts of Lisbon, making commuting relatively easy. The area is serviced by various modes of public transportation, including trams, buses, and trains, ensuring residents can navigate around Lisbon with ease.

For those traveling further afield, the proximity to Lisbon's major transport hubs, like the Lisbon Portela Airport, is a significant plus.

How much does it cost to buy real estate in Belém?

If you need a detailed and updated analysis of the prices, rents and yields, you can get our full guide about real estate investment in Portugal.

Belém is a unique and sought-after area for property investment offering a range of residential properties.

The types of properties you'll find here include apartments, houses, and some luxury villas. The high demand in Belém, particularly for apartments and renovated houses, is driven by its cultural richness, historical significance, and picturesque surroundings. Luxury villas, while less common, are prized for their exclusivity and features.

In terms of property market dynamics, Belém offers a mix of both new developments and resale properties. The new developments often aim to blend modern living with the area's historical character, attracting buyers looking for contemporary comforts in a traditional setting.

On the other hand, resale properties, especially those that maintain or enhance their historical features, are highly valued.

When it comes to pricing, properties in Belém vary significantly based on factors like size, condition, and location. Generally, you can expect to pay a premium for properties in this area due to its desirability.

Prices per square meter can range widely, but as a rough estimate, you might find properties starting from around €4,000 per square meter, going up to €10,000 per square meter or more for luxury properties or those in prime locations.

Over recent years, property values in Belém have seen a steady increase. This trend is a result of the area's growing popularity among both local and international buyers, coupled with the limited availability of properties. This scarcity, especially for properties with unique features or in prime locations, has driven up prices.

Looking ahead, there are several factors that might influence the real estate market in Belém. Any upcoming developments or city planning changes, such as improvements in infrastructure or the introduction of new cultural attractions, could further enhance the area's appeal, potentially leading to an increase in property values.

For example, any developments that enhance the waterfront or improve transport links could make the area even more desirable.

Predictions for the real estate market in Belém in the coming years suggest a continued interest in this area, potentially leading to further price increases.

Factors like the ongoing demand for properties in prime Lisbon locations, the limited availability of new developments in Belém, and the enduring appeal of its unique cultural and historical character all indicate a potential increase in value.

Where is the best area to buy a property in Belém?

When it comes to buying property in Belém, understanding the nuances of different areas within this historic district is key.

Belém is not a one-size-fits-all market; its diverse neighborhoods offer varying atmospheres, property types, and price ranges.

One of the most coveted areas in Belém is near the riverside, especially close to landmarks like the Jerónimos Monastery and the Belém Tower. This area is renowned for its breathtaking views of the Tagus River and its proximity to cultural sites.

Properties here are primarily upscale apartments and some renovated traditional houses. Due to the prime location and scenic views, the prices in this zone tend to be on the higher side.

Another notable area is the vicinity around the Ajuda Palace. This neighborhood, slightly more residential and quieter than the bustling riverside, offers a different kind of charm.

Here, you might find a mix of older houses and modern apartments. The atmosphere is more relaxed, and the prices are generally a bit more accessible compared to the riverside, making it an attractive option for those who prefer a serene environment.

An up-and-coming area within Belém is the vicinity of the LX Factory, a trendy spot known for its creative and bohemian vibe. This area has been undergoing revitalization, attracting a younger crowd and investors interested in modern living spaces.

Properties here are a mix of industrial-style lofts and contemporary apartments. It's an area worth considering, especially for those looking for a vibrant, youthful environment.

For those looking for property in Belém, focusing on areas near cultural landmarks or the riverside can be a wise choice. These locations offer a combination of scenic beauty, access to amenities, and a strong sense of community.

On the contrary, areas further away from the center of Belém, which might lack immediate access to the district's famed attractions and amenities, could be less desirable.

While these areas might offer lower prices, they may not possess the unique charm and convenience that define the Belém experience.

Here is a summary table to help you visualize better. If you need more detailed data and information, please check our property pack for Portugal.

Area	Description	Property Types	Price Range
Riverside (near Jerónimos Monastery and Belém Tower)	Scenic views of the Tagus River, close to cultural sites	Upscale apartments, renovated houses	Higher
Ajuda Palace Vicinity	Residential, quieter, relaxed atmosphere	Older houses, modern apartments	Moderate
Near LX Factory	Vibrant, youthful, creative and bohemian vibe	Industrial-style lofts, contemporary apartments	Varies, trending upward

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Is there a strong rental demand in Belém?

In Belém the rental market is indeed dynamic catering to a diverse range of tenant profiles

The demand for rentals in this area can be attributed to its cultural richness, historical significance, and scenic beauty, appealing to both short-term and long-term renters.

The rental market in Belém sees a mix of short-term and long-term demands. Short-term rentals are particularly popular among tourists and visitors drawn to Belém's landmarks, like the Jerónimos Monastery and Belém Tower.

This demand peaks during the tourist season, making properties close to these attractions highly sought after for short-term lets. Long-term rentals, on the other hand, are in demand among expatriates, professionals working in Lisbon, and students attending nearby universities or international schools.

The profiles of potential tenants vary. Tourists and short-term visitors often look for furnished apartments with modern amenities, preferably with easy access to Belém's cultural sites. For long-term tenants, the demand is more diverse.

Expatriates and international families often seek spacious apartments or houses, preferably close to international schools like St. Julian's School or the Carlucci American International School of Lisbon.

Young professionals and students, meanwhile, might prefer smaller, more affordable apartments, ideally situated near public transport links.

In terms of specific areas within Belém, the riverside and areas close to cultural landmarks are highly coveted for short-term rentals due to their scenic views and proximity to tourist attractions. For long-term rentals, neighborhoods near international schools and quieter residential areas are more appealing.

Amenities that can help reduce vacancy and make a property more attractive include high-speed internet, modern appliances, furnished interiors, and access to public transport.

Properties with additional features like balconies, gardens, or river views are especially appealing in the short-term rental market.

Regarding potential returns on investment, properties in Belém can be quite lucrative, especially if well-positioned and adequately furnished.

Estimations for rental yields vary, but properties in prime locations could potentially offer annual rental yields of around 4% to 6%. This estimation could be higher for properties optimized for short-term rentals, especially during peak tourist seasons.

In terms of property types with increasing demand and potential for better yields, modern apartments in the riverside area and renovated traditional houses in residential neighborhoods are gaining popularity.

These properties cater to the growing demand among tourists for short-term stays and expatriates or professionals for long-term rentals, thus offering potentially higher rental yields.

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Is it easy to buy a property as foreigner in Belém?

Before we answer the question, please know that we have an article dedicated to the experience of buying real estate as a foreigner in Portugal.

Buying property in Belém, Lisbon, as a foreigner is generally straightforward, thanks to Portugal's welcoming attitude towards international investors.

There are no specific regulations or restrictions that exclusively apply to foreign buyers, making the process accessible to all.

The purchasing process in Belém follows the standard protocol seen across Portugal. It typically starts with finding a property, followed by negotiating the price and terms.

Once an agreement is reached, a promissory contract (Contrato de Promessa de Compra e Venda) is usually signed, and a deposit (usually 10-30% of the purchase price) is paid.

The final step is the completion of the sale with the signing of the deed (Escritura) in front of a notary, where the remainder of the purchase price is paid, and the property is officially transferred to the buyer.

One of the primary risks associated with property investment in Belém, as with any real estate investment, is market fluctuation. Property values can go up or down based on various factors, including economic conditions and changes in demand.

Another risk is related to property condition and legal issues, such as unclear property titles or undisclosed structural problems.

There are some classic pitfalls or common mistakes that people, especially foreigners, may face when buying property in Portugal. One unique aspect is the importance of understanding the 'Caderneta Predial' and the 'Licença de Utilização.'

The Caderneta Predial is a document that outlines the fiscal description of the property, while the Licença de Utilização confirms the property's intended use (e.g., residential, commercial). Ensuring these documents are in order and match the property's actual status is crucial.

Working with a local real estate agent or lawyer is highly recommended. They can provide invaluable guidance through the purchasing process, help navigate the local real estate laws, and ensure all legal requirements are met. They can also assist in overcoming language barriers and understanding local market trends and practices.

Common exit strategies for property investors in Belém include selling the property for capital gains or renting it out for a steady income stream.

The choice of strategy often depends on the investor's goals, market conditions, and the type of property purchased. Belém, being a sought-after area, typically offers good potential for both strategies.