The price of properties in the Baixa and Chiado districts has gone up by 30% in one year.
Average values are around 4,000 euros/m2, but some apartments have already reached 10,000 euros/m2, a price similar to Paris.
The housing market has started to recover, but it is in Lisbon that the prices have risen, more particularly in the city centre, in Chiado, Avenida da Liberdade and Bairro Alto. Here, the increases were between 18% and 30% between 2014 and 2015, with average prices reaching 4,000 euros/m2. Some properties in the Chiado district and Avenida da Liberdade are negotiated between 7,000 and 10,000 euros/m2, prices similar to Paris.
According to the data provided by a company specialized in real estate statistics, these are the only areas to have recorded such rises between 2014 and 2015. In the other 21 other areas analyzed, prices went up between 1.25% and 11.4%, with prices in Lisbon going up by 9%.
In fact, in the Lisbon metropolitan area, prices only increased by 1.6% to reach 1,439 Euros/m2. In the Porto area, prices went down by 2.6% to €998/m2 while in Algarve they went up by 4.6% to reach 1,219 euros/m2.
The growing foreign interest for Lisbon, and in particular its historic centre, goes a long way towards explaining this evolution. Many buy to live there or spend a season, thanks to the tax exemption for retirees or the golden visa, while others buy to make money by renting to tourists. Some investors even buy properties to be rehabilitated (here again, there are tax benefits).
The evolution of prices is quite moderate at the national level because the disposable income of Portuguese families leaves no room for a quicker evolution of the property values in the short term. It is in the areas where there has been an increase in international demand, particularly in some specific areas of Lisbon and Porto, that increases of more than 15% have been recorded.
Houses are more expensive than in 2008
According to the statistical data of real estate, the district of Santa Maria Maior, which includes the historic centre down to the castle of São Jorge towards Baixa and Chiado via Santa Apolonia and Alfama is the area where prices have most increased. They went from 2,735 euros/m2 in 2014 to 3,565 euros/m2 in 2015, an increase of 30.3%.
In the Santo António district, which includes the avenida da Liberdade, Principe Real and Rato, prices went from 3,196 euros/m2 in 2014 to 4,157 euros/m2 in 2015, an increase of 30%. And in Misericordia, which goes from Bairro Alto to Santos and Cais do Sodré, the increase was 17.5% with 3,432 euros/m2 in 2014 and 4,035 euros/m2 in 2015.
For example, the price of an 80 m2 house, the average size of a 2-bedroom apartment in Portugal, which is the most sought-after type of property, went from 219,000 to 285,000 euros in the Baixa district. In Avenida da Liberdade and its surroundings, this type of property has seen increases from 256,000 to 333,000 euros. In Bairro Alto and Cais do Sodré, prices increased from 274,000 to 323,000 euros A larger apartment, which can be frequently found in these districts, can reach as high as 2 million euros.
According to the same real estate figures, prices on display in 2015, which do not necessarily correspond to the actual sale prices, are even higher than those of 2008 before the subprime crisis.
So, in the Santa Maria Maior district, the price/m2 was 27% higher in 2015 compared to 2008, in the San Antonio district + 25% and in Misericordia + 29%.
These increases must be moderated. The day there are fewer foreigners, no-one will be able to buy these properties at today’s prices.
Parque das Nações is cheaper
The Parque das Nações district is a perfect illustration. Prices displayed reached their highest value in 2014, precisely the year of the boom of the golden Visa and when the Chinese were looking for properties in this area. In 2015, there were less golden Visa and the prices dropped by 2.2%.
In fact, there are only three areas where the price of properties declined and Parque das Nações is one of them. Yet, at 3,363 euros/m2, prices in Parque das Nações are 17.4% higher than they were in 2008.