Algarve property prices may be set to rise after it emerged that the number built in the region fell last year.

Figures from Portugal’s National Statistics Institute revealed that in 2008 there were less than 1,500 new buildings of any kind constructed in the region, whereas in all other years since 1995 the annual total had been at least 2,300, Portugal Resident reports.

The news provider noted that demolitions outnumber constructions, something that may help prevent a glut of supply.

It noted that local architect Miguel Caetano recently told newspaper Jornal De Algarve there was no point in repeating the oversupply errors that have occurred elsewhere.

Algarve property may also benefit from increased rental demand around the times when its new motor racing track is hosting events.

The chances of it hosting a Formula One event could have been boosted by positive comments about the course made by drivers in a test last month, with McLaren test driver Pedro de la Rosa quoted by Autosprint magazine as saying: "It’s a fantastic track, it looks like a roller-coaster."

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