Longevity has been rising in Portugal and, as a result, a new segment is emerging in the real estate market. It is beginning to attract both private and institutional investors who favour long-term investment horizons and are looking for assets that are less exposed to short-term volatility: the purchase of properties with lifetime usufruct.
According to the Portuguese company Empathia, which focuses on promoting wellbeing and financial security for the senior population, this new model is starting to gain scale in the country.
“We are witnessing the emergence of a new real estate segment in Portugal, driven by demographic trends that are here to stay. Increasing longevity is creating different needs among property owners and, at the same time, new opportunities for investors who take a long-term view,” said Pedro Almeida Cruz, CEO and founder of Empathia, in a statement.
"Increasing longevity is creating different needs among property owners and, at the same time, new opportunities for investors," says Pedro Almeida Cruz, CEO of Empathia .
According to recent data from Pordata, Portugal has the second-highest percentage of people aged over 65 in the European Union, with 24.3% of the population above that age, and projections indicating that this trend will intensify in the coming decades.
This population ageing, combined with longer life expectancy, is leading thousands of seniors to seek solutions that allow them to convert their property wealth into liquidity without giving up their homes. As a result, selling a property with lifetime usufruct has emerged as an option.
An investor who purchases a property under this arrangement becomes its legal owner, while the seller retains the right to use the home for the rest of their life. Empathia also notes that, in addition to private investors, entities experienced in managing long-term horizons are beginning to show interest in this segment, including insurance companies, asset management funds, family offices and investors specialising in alternative real estate assets.
The possibility of acquiring properties below traditional market values, the prospect of long-term appreciation, and growing demand for investments aligned with structural economic trends help explain the increasing interest in this model.
“Longevity is transforming several sectors of the economy, and real estate is no exception. What we are seeing is the emergence of investors who recognise this structural shift and are looking to position themselves in a segment that remains relatively underexplored in Portugal. Our role is to bring the parties together and ensure that all decisions remain firmly in the hands of property owners,” Pedro Almeida Cruz added.
According to sector specialists, this segment of the real estate market is now beginning to gain scale at a time when longevity is expected to be one of the main drivers of financial and wealth innovation over the next decade.
