Is the crisis affecting real estate in Sweden and Portugal?

Sweden is experiencing its biggest real estate market crisis since the 1990s, but Portugal is still far from being affected by it, according to analysts surveyed by Lusa.

The number of homes sold in the Swedish market has fallen, with 13,800 houses and 23,000 apartments sold between May and July, down 12 percent from the same period last year, according to brokerage firm Svensk Mäklarsamfundet, as well as a decline in house prices.

The situation is different in Portugal, however: "We are very far from a mirror. The decline in real estate prices is not expected to occur in the coming years," believes Hugo Santos Ferreira, president of the Portuguese Association of Real Estate Developers and Investors (APPII), speaking to Lusa.

Economist Joao Duc believes that the development of prices and transactions in the European real estate market shows that there has been a negative trend since the fourth quarter of last year. Joao Duc explains that, although in general there is still a positive trend in the European house price index calculated by Eurostat when comparing the level of the index relative to the previous year, there are markets where it is negative: Sweden -6.9%, Germany -6.8%, Denmark -6.2% or Finland -5.1%.

"The situation is changing in Europe.

Joaoao Duc notes that "in Europe, real estate investment seems to be in a recessive moment," as, in addition to falling prices and transactions in the housing market, economic activity is contracting, which does not bode well for the search for commercial space or offices.

Is the correction in house prices a risk for Portugal? However, economist Pedro Brinca, despite noting, in a conversation with Lusa, that "there is a correction in international markets," citing the example of Sweden, believes that Portugal is still an exception.

"It doesn't surprise me at all that there is no price correction in countries like New Zealand, Canada, Portugal, etc.," he said.

Hugo Santos Ferreira emphasizes that the most recent data provided by the National Statistics Institute (INE) indicates that "house prices [in Portugal] continue to rise despite the decrease in the number of valuations," which immediately means "the difference with Sweden".

"We still have an unbalanced market in which there is a lot of demand and little supply," he emphasizes, considering that "it is important not to allow assets to depreciate".

The APPII president argues that if assets start to depreciate, as happened in Sweden, it is important not to allow assets to depreciate.It gives them other types of weapons that Portugal doesn't have," he said.