In the fourth quarter of 2020, the year-on-year change rate of the Housing Price Index (HPI) stood at 8.6%, up 1.5% from the previous quarter. The prices of existing homes increased at a slower rate than new dwellings, at 8.5% and 9.0%, respectively. In 2020, 171,800 houses were bought and sold, 5.3% less than in 2019, according to data published by Portugal’s National Institute of Statistics (INE).
Total sales of residences reached 26.2 billion euros, increasing by 2.4% compared to the previous year. The value of new housing increased by 9.3% to 5.4 billion euros, and that of existing housing increased by 0.7% to 20.8 billion euros. Between October and December 2020, 49,734 houses were bought and sold, resulting in a year-on-year growth rate of 1.0% and an increase of 10.2% over the previous quarter. In the last quarter of the year, total sales amounted to 7.5 billion euros, up 8.7% compared to the same period of 2019.
According to the INE, the average price of the homes sold last year rose despite the restrictions imposed due to the COVID-19 pandemic. The average annual rate of change index reached 8.4%, reflecting a moderation compared to the price growth observed in 2019 (9.6%). The report added that “The price growth trajectory was evident in both existing housing (8.7%) and new housing (7.4%). As in recent years, the difference in the pace of growth of existing and new housing prices has narrowed, falling from 2.5 p.p. in 2019 to 1.3 p.p. in 2020.”
In 2020, 171,800 dwellings were bought and sold, down 5.3% y-o-y. For the first time since 2012, the volume of sales fell, reflecting the pandemic’s impact. In January and February, before Covid-19 really began to hit the European economy, the number of transactions posted year-on-year increases of 9.4% and 3.5%, respectively. The period from March to October saw a series of decreases, particularly in the second quarter (-21.6%) of the year, when the lockdowns began. Year-on-year increases followed in November (4.0%) and December (12.6%). Of the transactions carried out in 2020, 15.5% were for new homes, 0.8% more than in the previous year.