Portuguese property prices are rising – and rising faster, according to new figures.
The latest index from RICS/Ci shows prices continue to recover across all regions. What’s more, the latest data suggests the rate of house price inflation accelerated across each market during August.
The growth is being fuelled by an increasing imbalance between supply and demand. Indeed, new buyer demand rose once more over the month, with the pace of increase edging up from the previous month. At the same time, new instructions to sell dropped back modestly for the first time since December 2014. Even with the sales only recording a marginal increase, demand is still outstripping supply.
As a result, agents expect prices will rise further in the coming three months and in the next year, with a predicted increase of around 5 per cent per annum over the next five years.
Meanwhile, the national confidence indicator rose to +32 from +28 previously, extending its run in positive territory for the 22nd month in a row.
The market’s ongoing recovery is being supported by the improving economic conditions, although the country has not emerged from the tunnel yet.
“Employment growth has been encouraging over the past year, driving an increasingly widespread revival in housing market activity,” comments RICS Chief Economist, Simon Rubinsohn. “Nonetheless, the labour market recovery still has a way to go and sustained progress is needed to underpin the residential property
sector going forward.”
Demand for property, meanwhile. is primarily driven by the ever-popular Algarve region, with some agents already reporting a lack of new houses to sell at a time when demand is expected to remain high.