Portugal’s property price growth second biggest in the EU
Portugal’s housing market experienced the second highest year-on-year growth in property prices in the end of last year, according to Eurostat.
Last week’s data on European housing market indicated a steady property price growth across the EU and the eurozone.
House prices, as measured by the House Price Index, rose by 4.2% in the euro area and by 4.5% in the EU in the fourth quarter of 2017 compared with the same quarter of the previous year. These figures come from Eurostat, the statistical office of the European Union.
The biggest growth in house prices was recorded in Ireland (11.8%), Portugal (10.5%) and Slovenia (10.0%).
Just one country saw a reduction and that was Italy (-0.3%).
In Portugal, the indicator grew 1.2% percent from the third quarter to the fourth quarter of 2017 with the country experiencing continuing growth from quarter to quarter during 2017. Year-on-year price increase for every quarter of the last year was recorded as Q1 – 7.9%, Q2 – 8.0%, Q3 – 10.4%, Q4 – 10.5%.
Supply/Demand Unbalance Pushes Up the Prices
According to The PropertyWire, Portugal’s property price increase has been gaining momentum due to supply shortage with fewer houses available for sale and rent than the market demands.
The biggest supply shortage has been recorded in the main residential areas of Lisbon, Porto and the Algarve.
In Lisbon’s historical centre, prices increased by 21.1% year-on-year and have doubled since 2013.
The same lack of supply is affecting the lettings market with rents going up sharply due to high demand and low numbers of properties offered for rent.
Overall, property agents in Portugal see demand from new buyers growing. However, as the number of properties offered for sale has been steadily decreasing for 11 months in a row, sales are picking up very modestly.