Sales volumes and confidence in Portugal’s real estate is still rising, and prices are still falling, says the latest RICS market index, although experts say they are nearing the bottom.
Sales volumes and interest in Portuguese property in continuing to pick up, but the economy needs to rise further before property prices increase, a new market index reveals.
The national confidence index, which measures price and sales expectation, was at +9, in February, a little lower than January’s +16, but it is the fourth month in a row there has been a positive figure in the RICS/Ci Portuguese Housing Market Survey (PHMS).
Despite the brighter sales market environment, house prices continue to slide, although the pace of decline has slowed significantly. All things considered, the sales market appears to be in better shape than at any other point since the survey was launched in 2010, states the report.
RICS Senior Economist, Josh Miller says, “The February results show improved buyer interest beginning to translate into greater transaction volumes, a trend which is projected to continue in the near term. This is slowing but has not yet arrested the decline in prices. Before we are in a position to talk about a genuine turnaround in the housing market the brighter macro news flow must be sustained.”
CI Spokesman, Ricardo Guimaraes says, “February marks the seventh consecutive month in which enquiries from potential buyers have grown and the eleventh month running in which sales expectations have been positive. This is reinforcing the view that we may be close to reaching a floor in terms of prices.”
Respondents are now expecting quite robust sales growth over the next three months and the positive figures indicate a genuine improvement in sentiment, says the report.
In the lettings sector, tenant demand experienced a marginal rise while landlord instructions fell for the fifth month in succession. Rents continue along their downward trajectory and are anticipated to fall further in the short term, but the outlook for lettings activity was more positive, with respondents expecting volumes to rise over the coming three months.
The PHMS provides a qualitative monthly assessment of the sales and lettings sectors based on around 100 regular responses. The PHMS contains a regional breakdown covering Lisbon, Porto and the Algarve.
By Adrian Bishop, Editor, OPP Connect
