Buying a house in these districts is proving tough — unless you’re loaded!

 In News, Property, Real Estate

If you’re planning to buy a property in Lisbon, Seixal, Setúbal, Sintra or Cascais you might want to think again, unless you’ve got deep pockets.

The prices of homes and the cost of servicing the mortgage are making It increasingly difficult to purchase a home in many districts of Portugal as the cost of having a home has tripled in three years.
In fact, the total financial cost of having a property in 50% of the 24 most populated districts and municipalities in the country has doubled says ECO online news.
In the first quarter of 2020, at the start of the Covid-19 pandemic, an average home in Portugal of 60m2 with a 30 year mortgage tied to a 12 month Euribor rate and with a downpayment of 20% cash would take up one-fifth of an average family’s income.
In the first quarter of 2023 this same house bought under the same financial terms would now require 38% more money to buy and service the mortgage.
In just three years, the repayments and interest on a house increased 1.9 times in the 24 most populated municipalities in Portugal with over 100,000 inhabitants.
The Lisbon Metropolitan Area topped the list, particularly in Lisbon, Sintra, Cascais, and Setúbal where the costs have more than doubled since the first quarter of 2020.
In Lisbon, for example, which is the borough that has the highest property prices per square metre (€3,965) and the municipality which has the second highest family income above €16,000 per annum (only surpassed by Oeiras), the increase has been drastic.
In the first quarter of 2020 a Lisbon family needed a downpayment of 20% of the value of a 60m2 home, at an average mortgage service rate of 42% of total net income, being below the 50% required by Bank of Portugal regulations, now the same family has to stump up a downpayment of 45% of the value of the home for the same sized property – just 5% below Bank of Portugal stipulations.

Image: Seixal – Wikipedia