Bank valuation of houses reaches new all-time high: 1,774 euros per square metre

The value of houses calculated by banks when granting credit rose in January for the 14th month in a row. The median bank valuation of housing for the country as a whole rose by 27 euros last month to 1,774 euros per square metre, which is also the highest since January 2011, when the Portuguese Statistics Institute (INE) series began.

The average value of bank valuations is based on surveys of banks when they grant mortgage loans to families.

In year-on-year terms, January brought a 14.5% rise in the valuation of houses by banks, accelerating in comparison to previous months.

With this value, a 100 square metre house will be valued by banks at 177,400 euros in national average terms (and by reference), with differences in values from region to region.

Since December 2023, the value of houses has grown uninterruptedly, which demonstrates the confidence of financial institutions in loans for house purchase, at a time when the easing of interest rates is once again boosting demand for housing by families and in a context of limited supply — as the banks have repeatedly warned.

According to INE, around 35,300 bank valuations were carried out in January, down 5.1% on the previous month and up 22.1% year-on-year.

Setúbal with the biggest increase, Azores with the only decrease

All the regions saw monthly rises, with the exception of the Azores, where the median valuation fell by 18 euros to 1,298 euros per square metre, and Madeira, which maintained the figure of 2,000 euros per square metre recorded in the previous month.

For its part, the Setúbal Peninsula region had the biggest advance of all the regions: it recorded an increase in the bank valuation of houses of 36 euros to 2,015 euros per square metre.

Greater Lisbon and Algarve continue to have the highest values, at 2,611 euros and 2,498 euros, after rises of 26 euros and 17 euros respectively.

In the other regions, there were increases of 17 euros in the North (to 1,515 euros per square metre), 20 euros in the West and Tagus Valley (1,326 euros) and Alentejo (1,132 euros) and 21 euros in the Centre (1,177 euros).

By housing type, the average bank valuation of houses in the country rose by 4 euros to 1,326 euros per square metre and flats soared by 31 euros to 1,993 euros per square metre.