Portugal’s real estate market is seeing rising sales volumes and new buyer inquiries, but recovery is patchy, with Porto suffering, according to the latest RICS/Ci Portuguese Housing Market Survey
The Portuguese market has continued its steady climb towards stability in October, including agreed sales rising at the fastest rate since 2010, although recovery remains patchy, say market experts.
Sales volumes and new buyer inquiries are rising and the National Sales Balance stood at around +20, the highest since 2010, when the RICS/Ci Portuguese Housing Market Survey (PHMS) was first launched.
But Porto is still suffering and prices are expected to fall further, while near-term sales look set to remain sluggish and economic improvement is needed before a recovery takes hold.
RICS Senior Economist, Josh Miller, says, “The on-going improvement in sales market activity appears to have gained added momentum recently, while prices have now remained more or less stable for the past few months.
“Although this comes as a positive development, a sustained period of economic growth and strong job creation will be essential if a genuine recovery in the housing market is to emerge.”
CI Spokesman, Ricardo Guimaraes adds, “Current market sentiment largely points to stabilisation, but there is some variation at the regional level, with confidence higher in Lisbon than in Porto and the Algarve. The banks are seen as a key factor in potentially extending the market recovery across the country.”
The national confidence index edged up to +14, following +9 in September, and has now been in positive territory for 11 months in a row.
New buyer inquires rose for the 15th consecutive month, reaffirming September’s sizeable growth in transactions.
The improvement in activity appears to have stabilised house prices nationally, which have now
remained broadly unchanged for the past three months.
Going forward, contributors are anticipating prices to remain flat in the near-term, with gains in sales volumes for the rest of the year.
In the lettings sector, a sustained pick up in tenant demand and a dip in new landlord instructions, has slowed the pace at which rents are falling, but has not halted it. However, they are at the slowest decline recorded by the survey.
Looking ahead, rents are expected fall slightly over the next three months but the negative trend has largely diminished.
The PHMS provides a qualitative monthly assessment of the sales and lettings sectors based on around 100 regular responses and contains a regional breakdown covering Lisbon, Porto and the Algarve.
Around 150 estate agents and developers who operate in the Portuguese residential sales market were surveyed and the data is regionally weighted and operator (agent/developer) weighted.
* Overseas property buyers are being advised to pick a winter sun bolt-hole destination carefully.
Among the resorts that can offer proven winter destinations is The Algarve, Portugal, the Costa del Sol and the Canaries, Spain, plus Florida, USA, the Caribbean and Egypt, says Angelos Koutsoudes, Head of the OverseasGuidesCompany.com, which publishes guides to buying property in and moving to 15 different countries.
Referring to UK buyers, he says, “With this year’s unusually persistent rain, how many of us wish we had a place somewhere warm and dry to shoot out to for a few days or a week before – or over – Christmas?
“But buyers looking for somewhere that offers respite from the UK’s winter climate should be certain their chosen resort or area offers everything that they want. For example, that southern Spain can get very cold in the winter if you’re off the coast often takes people by surprise, as does how cold the northern Costa Brava near the Pyrenees gets.
“Proven winter destinations include the Caribbean, Florida, the Canaries and Egypt, but other mainland European destinations, including the Algarve and Costa del Sol, can offer pleasant conditions during the winter months.”
Three issues buyers should consider are average temperatures, flight frequency and all-round seasonality.
By Adrian Bishop, Editor, OPP Connect