More than 70 thousand houses have been sold in the first semester of the year, generating a record business volume of 8.9 billion euros. Half of those sales occurred in Lisbon.
The real estate market in Portugal continues to soar. In the first semester of the year, more than 72 thousand houses were sold in the country, generating an 8.9 billion euros’ business volume. The sales volume rocketed 25% in comparison to the same period of last year, according to Statistics Portugal (INE). As for prices, they increased 8% in the second quarter.
Around half of the volume of houses transacted in the first six months of 2017 happened in Lisbon, where over 25 thousand houses were sold for 4.3 billion euros. It corresponds to a 30% growth in comparison to 2016, because of tourism and of a growing interest from more international investors in real estate assets in the Portuguese capital. As for Oporto, it was the second city in the country where sales totaled 1.4 billion euros between January and June of this year, meaning there was a 27% homologous increase.
Because of the growing demand, the natural tendency is for prices to increase. And INE’s data confirm just that: housing prices in Portugal accelerated 8% in the second quarter of the year. This means that housing prices in the country have been increasing for four years now, reaching their maximum in the last quarter of this year, reinforcing IMF’s warnings for the need to monitor the real estate market.
IMF economists emphasized, last December, that there was no reason yet to consider there is a real estate bubble in Portugal. Even so, after the contraction of this market during the crisis, this increase in housing prices in the next couple of years should draw the attention of the Portuguese authorities as for the evolution of houses “inflation”.
Another sign of the market’s strength is the positive evolution of the sale of new houses. The volume transacted increased 6% in the semester to 1.8 billion euros, a total of 11 thousand houses, and it continues to grow, after the minimum it reached in 2013.
Even so, the majority of transactions concern already existing houses: over 60 thousand houses were sold in Portugal for seven billion euros. In parallel, INE disclosed that the implied interest rate in housing credit increased slightly in August, standing at 1.014%. It was the second month in which this rate increased, after three years of registering falls.