New rental contracts see biggest fall since Covid

The number of new rental contracts in the first quarter of the year fell at its sharpest rate since the first quarter of 2020 during the Covid-19 pandemic.

In the first three months of the year 23,417 new rental contracts were signed, down 10.4% than the 26,131 registered in 1Q of 2024 – the quarter that notched up the greatest number of contracts since Portugal’s National Statistics Institute (INE) began taking records in January, 2020.

The fall in the number of contracts coincides with a like-for-like increase in the average costs of rents per square metre for new contracts. In other words the fall in new contracts is also related to fewer properties to rent available on the market.

On the other hand, in the first quarter the number of contracts to buy homes skyrocketed by 25%, despite the prices of properties having risen by 16.3% – the greatest increase ever, partly down to a fall in interest rates and the coming into force of a public guarantee to enable young people to get mortgages without having to put down a deposit.