Ratio of houses sold to built 10-1

In the past five years, for every 10 homes sold, only one has been built in Portugal according to the National Statistics Institute (INE).

The online news source ECO reports that since 2018 740,000 homes have been sold nation-wide, while just 54,000 have been built.

It is one of the reasons why residential property prices have risen over 80% over the past 12 years, above the EU average according to Eurostat the EU’s statistics agency.

On average, one square metre sells for €1,494 and €6.55 for rent. However the situation is different in cities like Lisbon or Porto where a two-bedroom apartment covering 70m2 will easily cost €250,000 metres to buy and €900 to rent.

Prices keep going up and all indicators seem to point to that continuing with the blame being laid at the doors of foreigners, the government and speciation because of a lack of supply compared to demand.

Since 2010 the prices of houses in the EU have increased 49%. In Portugal the increase was 80.54% — the 11th greatest increase of all the Member-States according to Eurostat. Data from the INE show that in the third quarter of 2022, house prices rose 13.1% while rents increased by 7.6%.

However, rents and prices in the two main cities of Lisbon and Porto rose at a sharper rate by 18.5% and 7.6% respectively in Porto, and 7.6% in prices  and 16% in rent in Lisbon according to data for the 2nd quarter of 2022.

Other reasons for more expensive housing to buy or rent are: the cost of building materials (to build a new house or renovate an existing one), the cost of planning licences and municipal and government taxes, and an overall lack of available housing stock.

Photo: Liam Mackay Unsplash