House prices in Portugal are rising again with a considerable increase that was expected in the second quarter of 2024. The National Statistics Institute (INE) reports that over the same period last year, real estate prices increased by 7.8%. This shows a slight slowdown in the previous quarter, indicating an increase in momentum in the housing market.
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Property Prices Increase In Portugal
The House Price Index (IPHab) increased by 7.8% yearly between April and June 2024, according to INE data. The rise from the first quarter of the year was 0.8 percent. The increase in price of existing price was huge where prices rose by 8.3%. For newly built homes, the price was just increased by 6.6%.
The quarterly growth rate was also positive. House prices rose by 3.9 percent in comparison to the Q1 2024. That is an impressive increase above the 0.6% change observed in the previous quarter. Prices of newly built and existing residences increased by 3.9% and 3.8%, respectively.
Rise In Real Estate Sales
The number of houses being purchased and sold also increased with the increase in price. There was a total of 37,125 houses sold in Portugal between April and June 2024. Sales increased by 10.4 percent during the same time period in 2023.
The total value of transactions was even more impressive which increased by 14.1% annually to 7.9 billion euros. Local residents made the majority of these purchases that was 86.1% of the overall market share. This sector was alone responsible for the purchase of 31,948 residences for 6.7 billion euros.
The number of purchases from overseas customers slightly decrease. Just 2,464 homes were bought in the second quarter by people whose tax domiciles are outside of Portugal, which is 2.8% less than the same period last year.
National Statistics Institute (INE) reported:
In the second quarter of 2024, the House Price Index (IPHab) increased 7.8% year-on-year, 0.8 percentage points (p.p.) more than in the previous quarter. In the reference quarter, the rate of change in prices for existing homes was 8.3%, above that observed for new homes (6.6%).
Regional Differences In Property Sales
The trends in Portugal’s real estate market varied by region. North of Portugal was the region that generated 29.6% of all house sales in the second quarter. The number of properties sold in the area was 10,995 which was a 1 percentage point increase over the same time the previous year.
INE explained:
Alongside the North, the Centre and Alentejo, with 5,885 and 1,945, respectively, were the other regions that showed increases in their respective regional shares, 0.5 p.p. and 0.2 p.p., in the same order
The percentage of national sales in the Centre and Alentejo areas also increased to 1,945 and 5,885 dealings, respectively. The market share of these areas increased gradually. Alentejo region acquired 0.2 percentage rise and the Center region gained 0.5 percentage increase.
Lisbon is famous for its strong real estate markets. There were 7,031 sales in the second quarter of 2024 which accounts for 18.9% of all sales in the country. The total value of property sales dropped in Lisbon. This sale was just 32.2% of the total sales in Portugal and a drop of 0.7 percentage points from the previous year.
They also added:
Transactions of housing located in Greater Lisbon stood at 7,031 units, that is, 18.9% of the total, a percentage identical to that of the same period last year.
In contrast, transaction value in the North increased by 1.3 percent from last year and reached 1.9 billion euros. Meanwhile, the Algarve’s transaction value fell by 1.3 percentage points and hit 912 million euros.
The second quarter of 2024 has brought momentum to real estate industry in Portugal. After a brief decrease, prices are rising once again. The increase in transaction numbers and prices suggests that buyers are still actively seeking homes in the northern areas of the country.
