MCG...don't get me started, just don't get me started!!!!!! :))
I am an libertarian free market economist by persuasion and all I am can say is that the property market in Western Algarve is, and has been since I've been here, the furthest thing I've ever seen from a "free market".
Prices have been, and even now with the current economic crisis, are incredibly inelastic, given the general poor quality of construction and the vast stock of unsold properties. I estimate that housing values and property prices would probably have to drop 40/45% over 2008 values before the Algarve market would really start to move again.
At present, they are down about 15-20%.
However, that is not the Algarve. People would rather sit on properties for 20 years rather than sell for less than what they personally think their properties are valued at.
Finally, remember, the competition is not just from the rest of the Algarve. It also from the Spanish Costas where there are tens of thousands more properties up for sale.
