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House prices continue to rise across the European Union (EU), with values in Portugal increasing above the average rate and demonstrating the strength of the real estate market in the country.

According to a report by the Portuguese news agency Lusa, house prices in the European Union rose by an average of 4.1% on year in the Euro Zone and 4.7% in the European Union (EU) in the fourth quarter of 2016, with Portugal recording higher price rises compared to both averages.

In Portugal, the return to strength of the real estate market saw house prices rising by an impressive 7.6%, but the highest on year rises were seen in the Czech Republic (11.0%), in Hungary (9.7%) and in Lithuania (9.5%), and there were no downturns in prices according to Eurostat’s figures.

The Eurostat report found that compared to the previous quarter, house prices rose by 0.8% both in the Euro Zone and in the EU, and the biggest rises were seen in Malta (6.0%), the Czech Republic (4.7%), the Netherlands (3.2%) and in Cyprus (3.1%), with the most significant drops experienced in Denmark (-1.5%), in Croatia (-0.6%) and in Belgium (-0.4%).

These figures also place Portugal above the EU average for the previous quarter with data showing that house prices rose by 1.2%.

The increase in house prices in Portugal has been attributed to many carious factors, including a rise in confidence levels in the market in general, along with a more politically and economically stable situation in the country.

Portugal offers a number of favourable tax incentives for those looking to invest in property in the country, including the Non Habitual Residency programme and also the Golden Visa offer.

The Golden Visa scheme allows for residency permits to be issued to those investing in property or business in the country and according to the Immigration and Borders Service in Portugal (SEF), the total revenue achieved through this permit scheme reached €3 billion in March.

The majority of this investment came through property purchases and so far this year some 679 Golden Visas have already been issued by the authorities showing that the scheme remains a popular way to attract overseas investment.