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Despite the “cooling down” of European real estate, house prices in Portugal should continue to grow, according to the European Commission in its autumn economic forecasts released earlier in November.

In a chapter dedicated to the housing crisis, the European Commission pointed out that, despite several Member States of the EU already reaching their peak in the second quarter of 2022, “constant price growth continues in Bulgaria, Croatia, Greece, Portugal and Slovenia”.

Indeed, house prices across the EU have been rising since the economic recovery of 2010, and especially during the pandemic, said the report, “albeit with notable differences between Member States”.

The last decade has seen prices double in Germany and the Netherlands, but in Portugal, property prices have grown even more significantly. The same performance was recorded in Ireland, the Czech Republic, Austria, Luxembourg, Latvia and Lithuania.

However, the report concludes that, at an EU level, “in the future, restrictions on families' borrowing capacity suggest that housing prices will remain under pressure in the coming quarters, before resuming growth”.

The rising price of property in Portugal has been something of a “will-they-won't-they” in the last few years, largely attributed to increased demand and reduced supply of properties in the Algarve.

But experts believe Portugal won't see a real estate bubble because it's a low-risk market and still has the potential for high financial returns. To make sure overseas buyers are getting the best value, come chat with the team at Algarve Home Sales for expert local advice.