According to its latest ‘Illustrative Insight’ report, DBRS said Portugal was among a group of nations which had shown “the most notable improvements” in property prices since the economic slowdown a decade ago.
Growth in Portugal was placed at ten percent, and was only behind that of Ireland, where prices had climbed by 12 percent. However, home owners in Ireland, as in Spain, are still plagued by negative equity.
In its report, DBRS said most European housing markets have recently been on an upward trend, supporting a strong recovery from the dramatic collapse seen in many markets over the past ten years.
Spain meanwhile saw growth of seven percent, while the UK is said to be “currently facing a challenging environment with the full impact of Brexit yet to be felt and London showing preliminary signs of a slowdown.”
The only country still in decline in Europe is Italy, where the housing market has shrunk by one percent year-on-year.
On a regional level, Lisbon continues to be where the cost of real estate is the highest, according to the INE, with the cost per square metre rising to €2,315 during the third quarter of 2017.
The capital is followed by Cascais, where property is valued at €1,893/m2, while Loulé in the Algarve comes a close third with €1,704/m2. Overall, three of the top six most expensive areas are in the Algarve, with Lagos in at fourth (€1,619/m2) and Albufeira (€1,523/m2) coming in just behind Oeiras (€1,572/m2).
Overall, properties in Lisbon, the Algarve and Madeira are all priced above the national average.
When focusing uniquely on residential property, the Algarve overtakes Lisbon, with housing in the southern Portugal region costing an average of €1,348/m2, as opposed to €1,242/m2 in the capital.
In major cities, housing prices soared, with a home in Lisbon now 15.5 percent more expensive than it was towards the end of 2016. Porto meanwhile also saw the cost of residential properties rise 14.1 percent in the space of just 12 months.
The price of apartments in the Algarve went up by 8.2 percent, while villas increased by 6.8 percent, in comparison to 5.3 percent and 4.9 percent, respectively, the year before.
Nationally, the average price for a square metre of floor-space was €1,127.
The tendency for growth in prices in the Algarve seems to have gained pace towards the end of last year, as in December the cost per square metre of an apartment was fixed at €1,456, and that of a villa at €1,435/m2.
According to a separate report, buying property in the Algarve is, according to bank evaluations, now 25 percent more expensive than anywhere else in the country.
This follows figures from the Association of Estate Agents in Portugal (APEMIP) that prices being catapulted to pre-crisis levels, sales as a whole were up by between 25 and 30 percent in 2017. Overall, more than 400 properties were sold every day last year.”APEMIP President Luís Lima explained that his association had anticipated these highly positive figures at the beginning of last year, and current projections “allow us to forecast that the real estate market will grow once again in 2018.”