The increase in inflation<\/b> and the decrease in purchasing power<\/b> have significantly affected the Portuguese in several areas. This is no exception when we talk about real estate market trends in 2023<\/b>.<\/p>\n
Experts point to a year of cautious optimism<\/b> in the real estate field, although there are many challenges. Explore with us the real estate market trends in 2023 and discover how the National Coordinating Director of DECI\u00d5ES E SOLU\u00c7\u00d5ES, Guida Sousa, views the current situation.<\/p>\n
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The sharp increase in inflation has direct effects on increasing the cost of living<\/b> and reducing purchasing power<\/b>. Adding to the fact that salaries remain practically unchanged, the Portuguese have suffered a decrease in financial capacity.<\/p>\n
As a consequence, they look for lower-value properties<\/b> (namely to remodel), prefer to rent<\/b> or postpone the decision to move casa<\/a>. This trend in the real estate market in 2023 is particularly true for those who depend on bank financing<\/b>.<\/p>\n <\/p>\n According to Guida Sousa, the increase in demand on the outskirts of cities<\/b> (for example, Lisbon, Porto and Coimbra), in rural areas<\/b> and Interior of the country<\/b>, mainly by the middle class.<\/p>\n Guida Sousa also clarifies that this trend in the real estate market in 2023 comes mainly from reasons of an economic nature, not just for reasons of preference: \u201cAt the time of the pandemic peak, this phenomenon began to be a requirement for families who wanted to escape from the hustle and bustle of the city and\/or having more space at home<\/b>. Post-pandemic, this is a criterion imposed on Portuguese families due to the lack of economic possibilities to live in big cities.\u201d<\/p>\n <\/p>\n The European Central Bank has been increasing interest rates. This is a tool that aims to slow down or reverse the rise in inflation, as it limits the money available to circulate.<\/p>\n The increase in interest on loans<\/b> makes it impossible for many families to buy a house (and for others to be able to sell), as it is more difficult to pay the installments. In a panorama of general sustainability, the granting of credit is more careful, which reduces the risk of default<\/b> and a consequent chaos identical to that of 2008.<\/p>\n Some owners are led to put their properties<\/a> for sale for a lower price, in order to generate liquidity. According to Guida Sousa, this leads \u201cto a negative adjustment of prices present in the market, even if minimal. Thus, we are facing conditions that encourage an increase in supply simultaneously with a decrease in demand, in the lower market segment, thanks to families with lower incomes.\u201d<\/p>\n This is one of the phenomena that contributes to price stabilization<\/b>, one of the most anticipated trends in the real estate market in 2023.<\/p>\n <\/p>\n The rise in interest rates and the drop in purchasing power determine the cooling of the real estate market<\/b>. Since a general slowdown in demand and a stabilization of inflation are expected, we can expect a more balanced and rational definition of selling prices<\/b>.<\/p>\n However, this adjustment is far from homogeneous. It will be much more visible to national buyers<\/b> (more subject to financing<\/a>, interest and inflation) than in foreign countries. And it is likely that some price increases will be felt, especially in regions where demand exceeds supply<\/b>, such as Lisbon and Porto.<\/p>\n Other trends in the real estate market in 2023 resulting from the correction of prices<\/a> include the increase in negotiation power<\/b> and the period during which the properties are on the market.<\/p>\n <\/p>\n 2023 is the year that confirms the foreign presence in the Portuguese real estate market<\/b> as predominant and inescapable. The reinforcement of North American investment<\/b> stands out.<\/p>\n The migration of the Portuguese middle class<\/b> to the outskirts and to the interior is largely dictated by the presence of the international upper classes<\/b> in urban centers and on the coast, where prices they shoot. At a European level, Portugal still has a stable real estate market and a low cost of living.<\/p>\n There are attractive factors such as quality of life, the intensification of teleworking<\/b>, security, the mild climate, gastronomy and ease of integration.<\/p>\n <\/p>\n As Guida Sousa illustrates, real estate market trends in 2023 are \u201ca sweet treat for some and a mischief for many others\u201d. It is not a year for alarms, but neither is it a year for excessive optimism.<\/p>\n The real estate market, as a provider of an essential good, is a perennially resilient sector, which continues to attract a lot of investment<\/b> and is a profitable and safe option for investing money<\/b>.<\/p>\n If you want to find out more about the real estate market, be sure to visit our blog <\/a>. At DECI\u00d5ES E SOLU\u00c7\u00d5ES, we not only want to offer you expert and personalized support, but also to provide you with useful information.<\/p>\n <\/p>\n2. The expansion of areas of interest<\/h3>\n
3. Rising interest rates<\/h3>\n
4. The adjustment of real estate prices<\/h3>\n
5. Foreign influence in Portugal<\/h3>\n
Challenges and opportunities<\/h2>\n