Portugal's Housing Market Slows as Growth Decelerates

Portugal's housing market is experiencing a significant slowdown, with house prices rising by only 7.6% in the past year, marking the largest homologous slowdown since June 2021. However, there is a notable exception in Lisbon, where prices have increased above the national average for the first time in three years.

Data released by the National Statistics Institute (INE) shows that the median price of family accommodation in Portugal was 1,565 euros per square metre in the first quarter, representing a 7.6% increase compared to the previous year. This is a decline from the 10.7% year-on-year rate seen in the fourth quarter of 2022.

The slowdown in housing prices has been consistent over the past three quarters, with a significant decrease from the peak of 17.8% year-on-year change in the second quarter of 2022.

The capital city of Lisbon bucks trend with housing prices rising above national average after three years.

According to INE, the median housing prices have increased in 20 NUTS III sub-regions, with notable growth in areas such as Lezíria do Tejo (+17.5%), Algarve (+16.6%), Leiria (+15.9%), Cávado (+15.6%), and the Lisbon Metropolitan Area (+15.2%).

Among the municipalities with over 100,000 inhabitants in the metropolitan areas of Lisbon and Porto, 14 of them have exceeded the national average in terms of year-on-year price changes. Loures stands out with the highest value at 26.5%.

While Lisbon had a lower year-on-year change at 9.2%, it achieved a noteworthy milestone by surpassing the national average for the first time since the first quarter of 2020, signaling a positive shift in the city's housing market.

These findings from the national statistics office indicate a general slowdown in the housing market in Portugal, with regional variations and Lisbon showing signs of resilience in comparison to other areas.

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