Real estate transactions fell in 2023 to 2021 levels

According to the latest Alfredo Prices Index Report undertaken in partnership with Doutor Finances, house transactions fell by €3.8Bn to the same amount transacted in 2021.

To December 2023, there were 18.7% less properties bought and sold compared to the same period in 2022, corresponding to a business turnover of €28Bn, down €3.8Bn on 2022. Despite this fall, 2023 was the second best year for the Portuguese housing market since 2009, the year when Alfredo began collating data.

The report also shows that Lisboners took over 60 years to pay off a mortgage for a 100m2 home. Alfredo has calculated that the debt to income ratio related to the average value calculated by the banks for a 100m2 property is the average annual salary of the residents in each municipality, taking into account that 30% of salaries are allocated to pay mortgages.

In Lisbon, the mortgage to income ratio shows that each resident takes 62 years on average to pay off a 100m2 property compared to a Guarda resident who takes 22 years to pay off their mortgage where house prices have fallen 6.3%.

The report also shows an increase of 1.89% in the number of properties available in the market in May, 2024 compared to May 2023. And the cost of building has never been so high according to Alfredo, with an average cost index of 120 and an average of 2,394 new homes getting planning permission.

Over the past four years, the cost index for new build increased 25.53% and the number of houses with planning permission increased by 11.97%.