A decrease in housing prices in26% of the country's cities by2023.
The real estate market is moving away from its past prosperity.
And more and more signals indicate that prices are not only slowing down, but also moving towards correction.
The bank valuation data highlights the loss of market strength.
Two months ago, the National Institute of Statistics (INE) reported the third consecutive slowdown in the quarterly year-on-year growth rate of average housing prices, marking the lowest level since the second quarter of 2021. The latest data from bank assessments further highlight the weakening of the market.
Cooling of the real estate market
According to the INE sample, which covers 156 municipalities with data for the current year, Anadia, Tondela, and Tomar are the most affected by the cooling of the real estate market in 2023, where there has been a decline of over 10% in the average value of bank appraisals from January to July.
Market behavior in Anadia and Tondela
The municipality of Anadia in the Aveiro district has recorded a 15% decrease this year, mainly due to a 23.7% reduction in values assigned to residential properties by appraisers. Among the 25 most populated cities in the country (with a population of over 100,000), Porto and Aveiro stand out, where since the beginning of the year there has been a correction in the average value of bank appraisals of 5.4% and 5.2% respectively.
The real estate market in Porto
“The exponential price growth, driven by their coastal location and largely explained by external demand, may currently be undergoing a normal adjustment process,” explains Maria Joana Canya, head of consulting at Worx, regarding these two markets.
Decrease in bank valuation in Lisbon
Lisbon is also among the municipalities where the bank valuation of housing has decreased.
The residential real estate market in Madeira
Funchal, which from January to July accumulated a 17.7% increase in the average bank valuation for residential properties.
Real estate market forecasts
Experts do not expect a contraction in the housing market in the coming months, unlike many other European markets. They point to a shortage of property supply in the mid and mid-high segments as a key factor that will continue to support price growth.
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