Non-EU foreigners ARE driving up house prices in Portugal says statistics organisation

New build properties €500,000 minimum in Lisbon as property market slows

“Buyers outside the European Union (EU) are inflating house prices who pay an average €405,000 compared to EU overseas buyers who pay around €277,000”. (INE)

 

The minimum price for new properties in new housing developments in Greater Lisbon has shot up to €500,000, setting a new benchmark in a country where the average take-home salary for a couple is just shy of €3,000 gross.

Greater Lisbon saw average prices go up by 14.2%, the biggest increase nationally, to an unprecedented €350.000.

Foreigners buying property in Lisbon represented 6.3% of purchases and 11.5% of the total value paid.

But the average new build price in Greater Lisbon has shot up to €514,000 while second hand homes are on average €310,000.

That said, the number of transactions in Greater Lisbon has hit its lowest level since 2016.

Last year, according to the Portuguese national statistics institute (INE) there was a fall in the number of houses sold of 18.7% to 31,400 transactions fewer than in 2022.

The 136,499 sales last year represented the lowest number since 2017 when 129,833 homes were transacted, showing a clear slowdown in Portugal’s property market

But the value at which homes are changing hands has fallen by 11.9% overall to €28Bn according to the INE which calculates that the average price of a property nationally now stands at €200,000. Compared to last year, the average price for property went up by 8.4% or €16,000.

Non new build homes saw average prices hovering around €150,000 while the average price of new build property nationally broke the €200,000 barrier for the first time at €213,401.

The second region after Lisbon with the greatest increase in average prices is the Algarve where prices have risen by 12% overall to €317,574.

New homes in the Algarve have an average price ticket of €394,000 while the average price of a second-hand home stood at €299,000.

However, the average price paid by overseas buyers nationally last year went up to €343,000 whereas the national average was €193,830 — in other words foreigners are prepared to pay €150,000 more than the overall average.

But the INE categorically states “buyers outside the European Union (EU) are driving up house prices who pay an average €405,000 compared to EU overseas buyers who pay around €277,000”.

Foreigners buy one in four houses in the Algarve while foreigners represent 7.6% of all purchases nationwide.

In the Algarve, however, foreign buyers represented 27.2% of all transactions and 38% of the total value paid.

In Lisbon and Porto the proportion of overseas buyers is slightly under 4%, representing 5.2% of sales. In Greater Lisbon overseas buyers represented 6.3% of purchases and 11.5% of the total value paid.