Continuing price momentum and strengthened sales expectations set the stage for 2025
The newly-published December 2024 Portuguese Housing Market Survey from RICS and Confidencial Imobiliário (Ci) has highlighted the strength of both prices and transactions volumes in Portugal at the end of last year.
Ricardo Guimarães, Director of Ci, pointed to a “sharp rise in transaction activity” as the year ended with an 11% year on year increase in property prices and a 27% increase in sales, attributing demand pressures and falling interest rates to the increase, with a “quick response from both families and investors” to the latter.
On the ground in the Algarve, Kronos Homes, which owns and operates a portfolio of resorts and developments across the region including the Vale do Lobo resort, has witnessed this strong appetite for property in Portugal first-hand.
Alda Filipe, who recently became the firm’s first female Partner in Portugal, comments: “Demand for homes in the Algarve has been strong and strengthening for some time, with both owner-occupiers and investors keen to take advantage of the excellent potential for capital appreciation that Portugal offers.
“We’re seeing buyers from around the world snap up homes in Portugal, from beachside apartments to spacious villas. There’s strong appetite for off-plan homes as well, which is why we are investing more than €200 million in new luxury residences in Vale do Lobo, situated in the ever-popular central Algarve, in the coming years.”
Wildly beautiful west
In addition to the central Algarve, Kronos Homes has seen buyers seeking properties towards the wilder western tip of the Algarve such as at the secluded Salema Beach Village. Nestled on a hillside sloping gently down to the beautiful Salema Beach, the two- and three-bedroom villas come fully furnished and equipped. An on-site pool, snack bar, two padel courts and multi-use sport and fun park area ensure families have everything they need to hand for a relaxing break in the sunshine.
While demand from tourists remains high, the Portuguese market is also underpinned by healthy domestic growth, as Tarrant Parsons, Head of Market Analytics at RICS, explains: “Portugal’s robust economic growth, driven by strong domestic demand and a booming tourism sector, is expected to persist and outperform the struggling Eurozone this year. With macroeconomic headwinds easing and policy rates likely to be lowered, the nation is well-positioned to maintain its solid performance.”
The RICS/Ci Portuguese Housing Market Survey observes an increase in new buyer enquiries, which stood at +6% in December 2024. Sales volumes, meanwhile, had shot up 11 percentage points since November.
Looking ahead, sales expectations for the next three months had a net balance of +22%, while price expectations for the coming quarter had a net balance of +31%.
“Demand is spanning all types of property in the Algarve right now, with strong expectations for a very positive year for the market in 2025,” concluded Alda Filipe.
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