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Property sector needs 70,000 new builds to keep abreast of demand

construction2Renting or buying a property, especially in Portugal’s cities, has become an unachievable dream for many people as prices continue to rise.

The construction sector gets the blame from Luís Lima, the head of the nation’s estate agents’ association.

"We have already presented a study to the state which says that there are around 70,000 new homes missing in order to have market equilibrium. Prices are growing because there is a lot of demand and little supply," claims Lima.

These ‘missing homes’ are at the national level, but "more than half are in Lisbon and Porto, where more than 50% of demand is concentrated."

The lack of houses can only be solved with an increase in new builds. Lima has no doubt that am urgent building programme is needed, especially for the middle class and young people.

Reis Campos, the president of the Construction and Public Works Association, shares this view and broadly agrees with the 70,000 estimate. Although there is evidence that new construction is recovering, the number of houses is well below what is needed to supply current demand.
Reis Campos said that at the beginning of this century more than 100,000 houses were built each year, but fell during the recession for sound commercial reasons.

"In 2011, only 17,000 houses were built, and during 2013/2014/2015 we have been building around 7,000 to 8,000 houses per year, growing in 2016 and 2017," notes Campos.

The Portuguese Association of Real Estate Developers and Promoters (APPII) reckons there is a huge opportunity for real estate developers as there is high demand from the middle class.

Hugo Santos Ferreira, executive vice president of APPII, has no doubt that one of the "big trends" this year is new construction outside urban centers for middle class buyers – not just Portuguese.

"If you think that it is only the Portuguese middle class that is in the market for housing, we have seen a new wave of middle-class foreign investors, who now are seeking a permanent or second residence in Portugal," says Ferreira.

"Among these foreign middle class buyers are many French, but also Nordic, like Icelanders, Scandinavians and Norwegians."

Ferreira believes also that there is a return to projects outside the main urban centres, stating that several promoters and real estate investors, national and foreign, have been working on new locations outside the prime areas.

Ferreira offers some hope, as long as people are content to buy outside the hotspots, "2018 will be marked by the return of some projects outside the high value segment which aim to to reach a wider audience. This trend is of the utmost importance and will greatly contribute to building market equilibrium for everyone which, if so, will certainly bring a more sustainable and long-term market."

Comments  

+1 #12 Denby 2018-07-05 08:13
A lovely old house that can be bought for peanuts, where do I sign....
This must be every dodgy dealers dream... an English person with money, who thinks they have pulled the wool over dodgy person's eyes.
If it is to good to be true.... then it is ... If you are not sure, I would advise that you get legal advice from a registered Solicitor.
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-1 #11 mj1 2018-07-04 13:04
terryp says 'Just do it' doesn't apply here, when the Portuguese govt want something the paperwork all seems to be fixed. the white elephant football stadium in faro, the motor racing circuit all got built "rapido"
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0 #10 Denby 2018-07-04 09:49
Why would anyone buy a property that has not had correct conveyancing carried out, to ensure it's legal standing.
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0 #9 Darren 2018-07-04 07:48
Terry P's waiting for 4 years + for a court hearing and making a judge angry needs expansion. Clearly Terry is not in the loop but it would be interesting to know if his case, like so many, connects in some way with Portugal's (Higher) unwritten laws. That whilst he has right on his side; the issue relates far more to some local heavyweight that has been inconvenienced. Perhaps they have always intended Terry's land or property to expand or improve on their own.
One regularly mentioned example of an unwritten law is that a neighbouring landowner must be given first refusal when selling (your) land. Many foreigners will have been told this piece of "doggy doo" - which you will soon realise it is a one way street. Land is transferring to new owners all around you without anyone involving you ! Another scam is wrapping the transfer up as a 'doacao' (donation) so avoiding complications - not that anyone important would need to ask.
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+1 #8 John Sturridge 2018-07-03 19:17
mj1 (or at least the man he was talking to 25 years ago) has hit the nail on the head. There are many many houses around Portugal than people - but so many of them are illegal. Never properly registered or legitimately built. Many now owned by foreigners like me. Some comments over the years on the expat websites make this abundantly clear. Similar to : "Help. Can anyone help us? We are extending what we were told when we bought was a legitimate house - but are now being told was only ever a cow shed or piggery to the Ministry / Municipal, Two different lawyers and their builder cousins are both giving us different advice what to do next ...." etc
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+2 #7 TerryP 2018-07-03 12:47
Quoting mj1:
p BOOKER...one urbanisation has been desolate near arm de pera for 30 years, roofs on etc but no one has ever lived there, val navio near albufiera , full of empty dwelling but now in the hands of a legal system never ever to be resolved...just two example, Get the camaras to sort them out before more land is destroyed
Totally agree.

Those two sites and, I suspect, many more, are left to rot, probably tangled in the legal system.

The 'Porches pink' development has been a blight for decades.

'Just do it' does not seem to happen here.

I have waited years for a court case that has not even started yet, nor can the Clerk give me a start date. I asked once and was warned off as I apparently 'made the judge angry' by even asking when i could expect the case to be heard.

Don't worry though, it's only my lifetime's savings.... what's another year, or another four... yawn....
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+1 #6 mj1 2018-07-03 12:32
p BOOKER...one urbanisation has been desolate near arm de pera for 30 years, roofs on etc but no one has ever lived there, val navio near albufiera , full of empty dwelling but now in the hands of a legal system never ever to be resolved...just two example, Get the camaras to sort them out before more land is destroyed
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0 #5 TerryP 2018-07-03 08:55
Quoting Peter D:
In 2011 the population was around 10m. with 3 5m buildings containing 6m dwellings . 30% either unoccupied or second homes. Over 25% were in need of repair. I agree with mj1 that it would be good to restore the old buildings. Need to sort out the legal system first.
That ties in with 4 million households and 6 million dwellings i.e. 66% occupancy, 34% empty or second homes.
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+2 #4 Peter D 2018-07-03 08:25
In 2011 the population was around 10m. with 3 5m buildings containing 6m dwellings . 30% either unoccupied or second homes. Over 25% were in need of repair. I agree with mj1 that it would be good to restore the old buildings. Need to sort out the legal system first.
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+2 #3 TerryP 2018-07-03 07:23
Quoting Peter Booker:
mj1´s comment is strange. Was it true that there was accommodation for 30 million people? Portugal has never had a population approaching even a half of that figure. I suspect that the original statement is tosh.

There is a demand for new housing in Lisbon and Porto - this fact has nearly always been true of these two major urban centres. And I bet there is spare housing in the interior of the country - housing which is well below modern standards, or perhaps even ruins - as people leave an agricultural life for a more modern and urban existence.


I expect the 30 million was the number that could be squeezed in empty bedrooms, not the number of houses.

There are 4 million households in the country - I am pretty sure there are not 26 million empty houses
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