The Rise in House Prices in Portugal in 2024

In 2024, house prices in Portugal saw an increase of 9.1%, nearly three times the EU average of 3.3%. This growth follows a period of slight price correction in the previous year, breaking a decade-long trend of continuous increases.

Portugal ranks among the countries with the highest price increases, surpassed only by nations like Bulgaria, Croatia, Lithuania, Hungary, and Poland. The ongoing rise in house prices reflects persistent demand despite the mild correction observed in 2023.

While the increase in house prices is a trend observed in several EU countries, the intensity of this appreciation varies. Countries like Germany and France, for instance, have seen price drops, reflecting a decelerating or recessionary market. However, in Portugal, demand for properties continues to grow, especially due to limited supply and factors like low-interest rates.

The rise in house prices in Portugal is linked to several factors, such as constant demand from foreign investors, limited market supply, and relatively low-interest rates. The combination of these elements has kept the market growing, although experts warn that this pace may not be sustainable in the long term.

Alongside the rise in house prices, rents have also seen a significant increase in Portugal, rising by 7% in 2024, well above the EU average. This places Portugal among the EU countries with the highest rent increases, surpassed only by countries like Hungary, Latvia, Malta, and Romania.

This increase reflects the rising house prices, as demand for rental properties remains high. This scenario is making rents increasingly unaffordable, posing an additional challenge for those seeking affordable housing.

In the EU, only a few countries have seen a drop in house prices, notably Luxembourg and Germany. Luxembourg, for instance, experienced a 5.2% decrease in house prices after an even larger drop in 2023. While prices have fallen in some EU countries, the increase in Portugal is notable and reflects a different real estate market dynamic.

The increase in house prices and rents has raised concerns about housing affordability in Portugal. For many young people and middle-class families, this growth in the real estate market has made buying or renting properties more difficult, limiting housing options.

The rise in prices may lead to a slowdown in the market in the long term, but for now, the growth trend persists, with direct impacts on the lives of those looking for a home.

The Portuguese real estate market will remain a key topic, especially as house and rent prices continue to rise. For consumers planning to buy or rent, understanding the current dynamics is crucial for making informed decisions about the future of the market.

While the rapid price growth has shown no immediate signs of slowing down, it's important to monitor economic developments and public policies that may influence the market in the medium and long term.

The Portuguese real estate market has shown a sharp increase in house prices, placing Portugal among the countries with the highest increases in the EU. This scenario is also reflected in the rise of rents, which have been growing at a rate above the European average. With high demand and limited supply, it's important to monitor how the market will develop in the coming years and how this will affect housing affordability in the country.

Source: SUPERCASA