Will house prices fall in Portugal in2024?

According to experts in the sector, the main reason why housing prices will not undergo corrections in2024 is the stable imbalance between supply and demand.

According to a report from ECO, housing prices have been rising for over ten years, and this is expected to continue into 2024. Despite forecasts of slowing demand and sales rates, experts surveyed by ECO do not foresee a decrease in housing prices in the medium term.

According to preliminary data provided by JLL, this year the market is expected to close with 20% fewer homes sold, reaching 133,000 transactions (compared to 168,000 in 2022) and a turnover that has decreased by "approximately 16%" to 27 billion euros compared to 32 billion last year. However, no one is predicting a decline in prices next year.

Patricia Baran, head of the housing department at JLL, notes that "there will naturally be a slowdown in growth [in 2024], but not a universal decline in prices, because the imbalance between supply and demand remains high."

Hugo Santos Ferreira, president of the Portuguese Association of Real Estate Developers and Investors (APPII), shares the same opinion.

The forecast for the continued rise in housing prices next year is shared by Paulo Caiado, president of the Association of Real Estate Professionals and Companies (APEMIP). Although he believes that the pace of property sales may slow down and the number of transactions may decrease, "all data indicates that we do not anticipate a significant increase in supply [in 2024] that could negatively impact housing prices."

According to the latest data from INE, in the second quarter of this year, the housing price index in Portugal increased by 8.7% compared to the same period last year, and during this period "prices for existing homes rose at a faster rate than for new homes, at 9% and 8% respectively," INE clarifies.

Similar trends are reflected in Eurostat data, which indicate that from 2010 to the second quarter of 2023, housing prices in Portugal increased by 93% (approximately 5.4% per year), while rental prices rose by 33% (2.3% per year). These figures place Portugal seventh among Eurozone countries for the highest increase in housing prices since 2010 and tenth in the ranking of Eurozone countries with the highest income growth.