What Expects the Portuguese Real Estate Market in 5 Years?

What Expects the Portuguese Real Estate Market in 5 Years?

The real estate market in Portugal is characterized by stable demand and supply with positive dynamics. The situation is similar also in the Portuguese rental housing market. The corresponding estimate is contained in the published report of the Royal Institute of Certified Surveyors (Appraisers) of the United Kingdom (RICS), which predicts that in the next five years, the average prices for apartments and houses in Portugal will increase by about 6%.

At the same time in the Algarve (Algarve) – the economic region in the south of the country, the rise in prices is slowing, but in the north, in the most promisingly developing Porto agglomeration, the value of real estate can grow even faster.

Confidencial Imobiliario analysts report a slight increase in supply in every region of Portugal, which holds back prices. Against this background, customer expectations remain optimistic. The demand for rent at the end of 2017 was somewhat weakened but remains reliable, with the minimal positive dynamics for 2018 remains unchanged.

Positive Dynamics

The real estate market is gaining momentum from the increase in lending in Portugal, which allows returning to pre-crisis housing prices in the foreseeable future. Housing prices at the end of 2017 were already only 1% lower than the maximum figure for 2010. In Portugal, there is not only the domestic demand for housing for their own residence but the activity of private investors who purchase real estate for tourism and rent.

The expert group International Investment recalls that the Portuguese economy is still one of the most significant in Europe, with accelerating GDP growth, real incomes of consumers, suppressed inflation, and low unemployment. At the same time, prices for the Portuguese real estate have been growing since 2015.

After several years of declining lending, Portuguese households are again increasing their activity in the housing market. The moderately growing internal and external demand for real estate in the country allows investors not to worry about the reliability of investments but also does not give grounds for expecting high profitability.

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