Portugal Property Management / Rental

With such a large investment, one must be comfortable with leaving it for long periods of time in the hands, of who effectively is a stranger! Sounds scary, but it really isn’t.

There have been people doing this for a long, long time, and again with so many things in property abroad, make sure you choose the right company for you!

Thinking About Renting Your Property?

The main thing to consider, before appointing a management company is whether or not you want them to rent it for you, or to look after it for you. There are many small companies, who are fantastic are making sure your property is safe and secure, and helping with any problems you may have such as a leaky roof, or a friend staying that needs help with the swimming pool! This would be for those that seek to make their own rentals, or do not intend to rent out their home.

Rental Income

For anyone looking to make a rental return, which is a highly lucrative prospect in Portugal, would be as equally, or even more so, concerned with the ability to market and rent the property. The larger companies have ties with the big tourist companies which make block bookings of apartments and villas, although they are renting at a lower rate, there is a much greater chance at a longer rented period without leaving much to chance, this is a huge incentive and as well as the tour operator bookings, larger firms tend to have a more year round rental ability with golf trips and “holiday packages”.

Other Options

One thing that is worth considering here is where your property is, if it is not one of the “tourist trap” area’s, then a local agent specialising in that particular area is a much better option, they tend to have less properties to fill, and are able to give you a very good estimate on how many weeks they can rent for you.

Other options available to you are to use the local newspaper classifieds, the online websites for owners, such as ownersdirect.co.uk and daft.ie. Remember any rental you make yourself, will be exempt of commission payments.

How Much Can I Make?

Portugal has been a very profitable place for rentals over the years, and remains so today. Many owners having earned in excess of a 10% rental yield for the last few years.

Although prices have increased steadily over the years, you would still expect to achieve a 5% rental yield each year. Of course each property is different but most rental agencies will claim to rent out around 12 weeks per year on average, mostly covering the summer.

Some companies have various options available to choose from, depending on how much, or little you intend to rent for, below you can see an example of a rental contract showing the various choices available:

RENTAL TERMS

PERCENTAGE BASED CONTRACT • FLEXIBLE INCOME

OPTION A - 1

GARVETUR arranges for a tenant, sets the contract between the owner and the tenant and collects the first rental as a commission. The property owner will receive from GARVETUR the rental file and all future contacts will be between the property owner and the tenant.

OPTION A - 2

20% GARVETUR’S income (Monthly/Yearly based residential rentals)
80% CLIENT’S income (Monthly/Yearly based residential rentals)
Maintenance is of the owner’s responsibility, being water, gas and electricity to be agreed between the parties.

OPTION B

25% GARVETUR’S income (Holiday Rentals)
75% CLIENT’S income (Holiday Rentals)
Garvetur’s responsibility: Reception / Marketing / Management support / Repairs and replacements due to improper use.
Owner’s responsibility: Cost of Cleaning / Cost of Laundry / Wear and tear maintenance / Expenses related with water, gas, electricity / Property Interior design.

OPTION C

40% GARVETUR’S income (Holiday Rentals)
60% CLIENT’S income (Holiday Rentals)
Garvetur’s responsibility: Reception / Marketing / Management support / Cost of Cleaning.
Owner’s responsibility: Wear and tear maintenance / Expenses related with water, gas, electricity / Property Interior design / Cost of Laundry / Repairs and replacements due to improper use.

Payments:

In one or more instalments depending on the extension of the contract, made by bank deposit and file sent to home address, with balance of account.

Please note:
- Rates and condominium fees are always paid by owner.
- From the total of the net revenue of the apt / villa (total of rentals, less 5% VAT tax) Garvetur´s commission will be deducted.
- Due to normal wear and tear, after 3 years of contract, linen and towels are not any longer part of the inventory.
- The daily rates applied will be in accordance with the season and any other contracts that Garvetur has with Travel Agents or Tour Operators, or as a result of any promotions made to increase occupancies