It’s a lack of houses on the market. This is the summary from the monthly Portuguese Housing Market Survey conducted by Confidencial Imobiliário and RICS. “The housing shortage continues to be one of the main factors influencing the market in a scenario of growing demand.”
"For the agents interviewed, the shortage of supply is the main constraint on their activity and also the main factor determining the evolution of prices. This situation should dominate the trends in the coming months," explains Ricardo Guimarães, Director of Confidencial Imobiliário.
“On the other hand, "prices are beginning to rise widely throughout the country, not only in the main cities, which may induce a turning point in the market. In other words, this context can boost the development and financing of new houses, thus reducing the mismatch between supply and demand. But this will take time to happen," says Guimarães.
Over the coming 12 month period, the respondents to the survey predict a 4% increase in house prices nationally and that there will be a five year growth period during which property prices will rise 5% per year on average.
In May, the pressure on supply was intense with sale numbers easing, especially in the Algarve where new sales listings have declined, with Algarve-based respondents reporting the most significant drop since 2011.
At the same time, agreed sales continued to rise for the 16th consecutive month and demand from new buyers also maintained solid growth with Lisbon buyers leading the pack. In terms of booked sales, all three regions (Oporto, Lisbon and the Algarve) recorded an increase and it is expected that this trend will continue in the coming months.
"Employment growth has accelerated in all sectors of the Portuguese economy in recent months, with the most recent figures showing an annual increase of more than 3%. This sustained growth continues to support real estate activity and the outlook for further growth next year looks promising given the current macroeconomic situation," concludes Simon Rubinsohn, Senior Economist at RICS.
