The latest Portuguese Housing Market Survey has found that the high demand for property in Portugal continues to drive up prices within the market.
The May 2017 RIC/Ci Portuguese Housing Market Survey found that enquiries for property continue to show healthy growth, while prices also continue to increase, however prices are rising at a softer rate than in previous months.
As the number of people looking to purchase property in Portugal grows the number of houses actually being put on to the market continues to decline and this has led to a situation with demands allowing prices to increase.
According to the report: “Solid activity growth was reported once more in the sales market during May, with agreed sales continuing to rise for a sixteenth consecutive report. Moreover, all three regions were cited to have seen an increase in agreed sales (Lisbon, Porto and the Algarve). Looking ahead, sales are expected to rise further in all three areas over the near term.”
Average prices in Portugal are on the up and the survey found that the Algarve was the area in Portugal which saw the biggest drop in new sales listings – indicating a rise in demand that has been reflected in house pricing.
The survey found that contributors predicted that house prices in Portugal would rise by an average of 4% over the next 12 months and that house price inflation is expected to average around 5% per annum over the next 5 years.
Ricardo Guimarães, Director of Ci said: “Agents are all very clear: the lack of supply is the main constraint on their activity and also the main factor determining how prices are changing. This appears to be a topic that will dominate trends over the coming months. Meanwhile, prices are starting to move up, and not only across main cities. Price growth is becoming more widespread and this may induce a turning point, enabling development and financing of new properties, thereby reducing the gap between demand and supply. But this will take time.”
RICS Chief Economist, Simon Rubinsohn: “Employment growth has accelerated across the Portuguese economy in recent months, with the latest figures showing an annual increase in excess of 3%. This sustained improvement continues to support housing market activity and prospects for further growth over the year ahead look promising given the current macro climate.”
While the number of new listings may be reducing there are still plenty of property options available in Portugal and even in the most sought after areas such as the Algarve.
To find out more about the housing market in Portugal or to search for properties for sale, please contact a member of the team directly.