Delays in planning permission licences hold up 53,200 apartments

A significant slice of new apartments, whose applications for planning permission have been submitted to municipal councils in Portugal over the past 5 years, have yet to receive planning permission according to Confidencial Imobiliário.

Between 2019 and 2023 councils on mainland Portugal received applications for 128,800 new apartments, of which just 59% (75,550) homes were given licences allowing work to begin. But 41% of applications for the potential offer has yet to be decided, or a total of 53,200 apartments.
This portfolio of housing offer that has not been built is similar to the number of apartments that was completed because their applications for planning permission had been processed and were completely absorbed by existing demand.
According to an analysis by Confidencial Imobilário, based on data for pre-certificates issued by the Agency for Energy (ADENE), which reflect real estate development investment intentions, and housing planning permission data from the national statistics institute, INE, between 2019 and 2023, 48,900 apartments would have been completed and sold according to projections on transactions recorded in the SIR-Residential System data base.
This means that over the past 5 years it would have been possible to double the amount of new housing offer in Portugal and, as a result, contribute to reducing Portugal’s chronic housing shortage.
Ricardo Guimarães, director of Confidencial Imobiliário, stated in a communiqué: “This data shows that there is a very relevant gap between investment intentions and works that actually advance. Moreover, this gap has got wider with each year to such an extent that the ratio between works, which we see from the panning permission licences issued, and the projects with planning permission applications, apparent from the pre-certificates, fell from 74% in 2021 to 53% in 2023”.
He added that “putting such an important slice of planned offer on ice above all reflects the cycle of instability in recent years, marked by the pandemic, the war, inflation, the increase in interest rates at a national level, the More Housing package, a context which when taken together means in practice the removal of 53,000 new apartments from the market.”