In recent months, Portugal’s real estate landscape has caught global attention, both for booming foreign investment and mounting affordability concerns. American buyers targeted upscale two-bedroom apartments and four-bedroom villas in Lisbon and the Algarve, raising the average sale price.Yet behind this surge of House Investment in Portugal lies a warning sign.
A new report from the European Commission reveals that Portuguese housing is among the most overvalued in the EU. It is about 35% above its intrinsic value. Construction of new houses has also declined, and hasn’t been able to balance the rise in prices.
Luxury real estate is thriving with foreign capital, while many local residents face a housing market that’s accelerating far beyond average incomes. For the first time, some house prices exceeded 2000 €/m2 (217 $/sq feet). The challenge ahead for Portugal will be to balance growth in premium sectors with restoring affordability across the board.
To see the more recent statistics in terms of house prices, see here in the INE (National Institute of Statistics) portal. Also, learn how to buy a House in Portugal.
Did you know Portugal received an award?
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