“Portugal has maintained a privileged position as an attractive destination for foreign buyers. At the end of 2022, foreign residential investment amounted to 3.6 billion euros, out of a total of 10,722 properties sold. A demand that remains solid, based on strong market fundamentals such as security, climate and living conditions, also now based on the growing transition to the digital economy that allows anyone to work remotely anywhere in the world”.
According to the “Savills Executive Nomad Index” cited in the study, Lisbon was considered the best city in the world for digital nomads, surpassing cities like Miami, Dubai and Barcelona.
France, the United Kingdom, Brazil, China and the United States of America have led the sales charts, presenting profiles of buyers who focus their search on areas of greater excellence with a view to acquiring a permanent residence or second home in prestigious buildings, high architectural quality.
“Looking at the number of international buyers investing in Portugal, they could represent around 15% of the market globally. However, if we only look at the high-end market, where we are positioned, foreign customers represent more than 50% of transactions carried out, a value that should be maintained. This type of investor naturally does not feel the impact of inflation and rising interest rates in the same way and continues to consider our market as one of the most attractive”, points out Miguel Lacerda, Lisbon Residential Director, Savills Portugal.
At the end of 2022, approximately 51,000 homes were sold in the Lisbon Metropolitan Area, a number fully in line with the year 2021.
The city of Lisbon accounted for the largest share of transactions in the Lisbon Metropolitan Area with approximately 11,300 homes sold, followed by the municipalities of Sintra, Setúbal and Cascais.
According to the pipeline surveyed by Savills, more than 4,500 new residential dwellings are expected in the next two years in the municipality of Lisbon (considering only projects in the current state of construction). However, it is important to stress that at the time of publication of this report, only 32% of residential units are available for sale, figures that prove the strong dynamics of demand.
Average sales prices for new properties in the Metropolitan Area of Lisbon in 2022 registered a decrease of almost 7% compared to 2021 prices, closing the year at €5,399/m2, a value that means greater stabilization and a slowdown in the pace of growth compared to previous years, while average sales prices for second-hand properties increased by around 5%, standing at €3,225/m2.
In the luxury segment (5% more expensive properties), an analysis carried out since 2011 reveals that asking prices in the new segment stood at €5,000/m². In 2022, they reached 11,500 €/m², with constant growth in the last 12 years.
Faced with the challenges that the increase in construction costs imposed on the market, Savills questioned three of the most important developers in the residential market present in Portugal about the impact of this increase on the final price of its projects.
About this collaboration, Alexandra Portugal Gomes says “on balance, the feeling is one of optimism, albeit with greater moderation. The projects continue to move forward with the accommodation of the rise in construction costs, reflected in the asking price values in the projects being sold. For 2023, we foresee a continuous development of new projects, with a slight increase in prices”.