1 house sold every three minutes in Portugal

House prices in Portugal grew by 12.9% in the first quarter of this year, even more than in previous months. Even the beginning of Russia's invasion of Ukraine, and rising inflation, did not stop the purchases. And yes, it was mainly Portuguese who bought them: in every 17 houses sold, only one was sold to foreigners.

According to a report by CNN Portugal, on average, a house was traded in Portugal every three minutes – including early mornings and weekends. On average, each house was sold for around €186,000. For every 17 houses sold, 15 were bought by families. Of the same 17 houses, 16 were sold to Portuguese and one to foreigners.

In the meantime, the figures released by the National Statistics Institute (INE) reveal that in Q1 of 2022, the House Price Index (HPI) grew by 12.9 per cent year-on-year, up 1.3 percentage points (pp) from the previous quarter. In the same period, prices of existing dwellings increased at a higher pace than new dwellings, by 13.6 per cent and 10.9 per cent, respectively.

Price increases were more pronounced for second-hand homes (13.6%) than for new ones (10.9%). Compared to the previous quarter, the HPI increased by 3.8 per cent (2.7 per cent in the previous quarter). By category, prices of existing dwellings increased by 4.4 per cent, higher than that of new dwellings (1.8 per cent).

In every 17 houses sold, only one was sold to a foreigner at an average sale price of around 186 thousand euros.

Between January and March, 43,544 dwellings were sold, representing a year-on-year growth rate of 25.8 per cent (17.2 per cent in the previous quarter) and a quarter-on-quarter decrease of 5.1 per cent (reduction of 11.6 per cent in the same quarter of 2021). In the reference quarter, the value of the transacted dwellings reached approximately 8.1 billion euros, 44.4 per cent more than in the same period of 2021. 

In the reference quarter, dwellings acquired by Households corresponded to 37,840 units (86.9 per cent of the total), totalling 7.0 billion euros (86.1 per cent of the total). In this period, 5.9 per cent of the total number of transactions (2 556 dwellings) involved buyers with a tax residence outside the National Territory, a percentage that rises to 10.4 per cent if the transacted value is considered.

Real estate has been rising for several years in Portugal, thanks to the increasing demand for houses by foreigners. However, in this first quarter, only 5.9 per cent of the total number of transactions (2,556 homes) involved foreign buyers.

Only new statistics will reveal whether during the second quarter the real estate market underwent any changes due to economic uncertainty triggered by the Russian invasion of Ukraine and rising inflation and interest rates.

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