Surging Housing Prices in Portugal: A Closer Look
In a dynamic real estate market, the median price of residential properties in Portugal has seen a substantial surge, spiking by 9.0% during the second quarter in comparison to the same period in 2022. This growth has propelled the median price to an average of 1,629 euros per square meter (m2), according to data from the National Institute of Statistics (INE).
This impressive figure signifies not only a notable 4.1% increase when contrasted with the first quarter of 2023 but also a marked acceleration in year-on-year variation, surpassing the 7.6% recorded from January to March.
Within this period of analysis, it's worth noting that 19 NUTS III sub-regions experienced a rise in median housing prices compared to the same period the previous year. The Autonomous Region of Madeira stands out with an astounding 24.9% increase, followed by Médio Tejo with a substantial 15.9% growth.
Moreover, four NUTS III sub-regions, which boasted higher housing prices than the national average, also exhibited even more significant year-on-year rate changes, underlining the vibrancy of these markets. These regions are Algarve (2,583 euros/m2 and +9.5%), Lisbon Metropolitan Area (2,306 euros/m2 and +11.1%), Autonomous Region of Madeira (1,916 €/m2 and +24.9%), and Metropolitan Area of Porto (1,802 euros/m2 and +14.3%). Médio Tejo also showcased an impressive rate of change at +15.7%.
On the other hand, some sub-regions faced declines in housing prices during the second quarter of 2023 compared to the same period in the previous year. Notably, Viseu Dão Lafões (-12.9%), Baixo Alentejo (-10.9%), Beira Baixa (-8.6%), Beiras and Serra da Estrela (-6.4%), Alto Tâmega (-5.4%), and Terras de Trás-os-Montes (-3.6%) experienced these year-on-year decreases.
As has been the trend in previous quarters, Alto Alentejo presented the lowest median sales price for family accommodation, standing at 546 euros/m2.
The foreign buyers' segment also played a role in shaping these dynamics. During the same period, the median value of family homes transacted in Portugal involving buyers with tax domicile abroad reached 2,409 euros/m2, marking a 5.1% increase compared to the same quarter the previous year. For transactions by buyers with tax domicile in the national territory, this value was 1,588 euros/m2, indicating an 8.7% increase in comparison to the same quarter of the previous year.
The four sub-regions with the highest median house prices – Algarve, Lisbon Metropolitan Area, Madeira Autonomous Region, and Porto Metropolitan Area – also presented the highest values in both categories of the buyer's tax residence.
In the metropolitan areas of Porto and Lisbon, the median price (euros/m2) of transactions carried out by buyers with tax domicile abroad significantly exceeded the price of transactions by buyers with tax domicile in the national territory, showing increases of +61.3% and +91.6%, respectively. These figures underscore the attractiveness of the Portuguese real estate market to foreign investors, adding an interesting layer to the evolving property landscape.