16 November 2023
After last week's detailed look at the evolution of house prices in Portugal over the previous five years, the aim now is to provide you with an impartial and factual analysis of the housing market, which will give you and other readers access to the most enlightening data and the best-documented sources.
Only in this way will we be able to build a more informed and robust opinion on the challenges facing housing in Portugal.
When you follow the media, you can get the idea that the state of the real estate market is defined essentially by financial deficits, regulatory measures, or political programs.
This idea prevails because these are the instruments that allow monetary institutions and governments to stimulate the economy to achieve the objective that, at a given moment, meets with the most consensus. And it is undeniable that these variables significantly impact our ability to buy or rent a home at any given time. But, at the end of the day, these dimensions only act on a determined reality.
And the reality is that people move house essentially because someone is born or dies or someone joins or separates. Because a young adult stops living with their parents or an older person moves in with their relative. Or because someone, for one reason or another, feels the need to move to another neighborhood, city, region, or country.
The first of these reflections is on Demography, the discipline that studies populations, their distribution, and characteristics. Because it is probably the most essential variable for understanding a given residential market. And believe me, this analysis goes far beyond knowing how many people live in Portugal, Lisbon, or Porto.
The second article is dedicated to Supply, a dimension that is widely expected to be able to respond to a large part of the country's housing challenges. But does this dimension begin and end with the number of houses that are built? Or is there something else in the equation?
Thirdly, there would have to be a text in which I explain the fundamentals of the evolution of housing Demand in Portugal. We need to remember the public debt bailout, what caused it, what happened next, and all the most important events up to 2023.
I'm also going to talk about the much-talked-about foreign demand. Does it or does it not significantly impact values in the residential market?
The fourth article will discuss three hotly debated topics: Local Accommodation (short-term rentals), Golden Visas, and Non-Habitual Resident status.
Don't you sometimes feel that the most vital voices in the public arena are committed to economic interests or political agendas?
This chapter is one of those that most divides opinion and exacerbates tempers. I will ensure you have access to a plurality of facts and perspectives to allow you to build a more informed opinion.
And finally, a short reflection on the role that the State can and should play in each of these matters. What incentives are available to it? Should it just legislate? Or should it also monitor the impact of political action to ensure it achieves the desired goal?
The primary purpose of HOUSING SPECIAL 2023 is to hold an independent discussion on the challenges we face in such a central dimension of our lives, addressing some of its fundamental variables, listing relevant facts, and challenging some beliefs.
Do you still remember what I wrote at the beginning of this text? After these 7 articles, I hope you'll have more information about what most impacts the residential real estate market and access to housing. And that you can build a more robust opinion.
It's about not settling for superficial approaches, where "black-or-white questions" provide "yes or no answers".