Property sales in Portugal have increased firmly across all areas of the country, most notably Lisbon, Porto and the Algarve with demand from buyers increasing, according to the latest index data.
Estate agents reported a strong increase in new buyer enquiries in February with sales rising at the sharpest monthly rate since September 2015, according to the housing market survey from the Royal Institution of Chartered Surveyors and Confidencial Imobiliário.
It means that the rate of sales growth has now strengthened in each of the last three index reports and going forward agents expect sales to continue to increase over the next three months.
The report also predicts that house prices are set to average nearly 5% per annum over the next five years.
New sales instructions rose marginally for the second consecutive period, although this modest increase was once again outpaced by demand and the report suggest that these conditions continue to place significant upward pressure on house prices.
The regional breakdown continues to point to the sharpest gains in Lisbon. However, over the next 12, respondents are now most confident in seeing further price growth across the Algarve, with a net balance of 74% more contributors anticipating higher prices in a year’s time.
The national confidence indicator, an amalgamation of near term price and sales expectations, edged higher in February, posting a reading of +42, the second highest figure since the survey’s inception in 2010.
In the lettings market, a persistent lack of landlord instructions remains a dominant factor pushing rents higher and the acute shortage of landlord instructions shows no sign of abating.
This, coupled with strong demand, is ensuring rents continue to rise at a significant pace while expectations suggest this trend will continue over the coming months, the report points out.
‘Over the past 12 months Portugal’s labour market has seen a sustained recovery, with overall employment levels rising by nearly 2.5%. Stronger employment, along with the broader improvement across the economy more generally, appears to be providing crucial support to continued growth in housing market activity,’ said RICS chief economist, Simon Rubinsohn.
