Portuguese immigrants are buying heavily: House prices rise to record levels in Lisbon

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An impressive 30 percent: house prices in Portugal’s capital have risen this much in just the last five years. Lisbon is therefore more expensive than Milan, Madrid and Berlin. Bloomberg news agency understands that the sunny climate and prices, which despite the increase are still half as high as those in Zurich or Paris, attract wealthy foreigners to Lisbon.

“Even if sales weaken, there are not enough houses to meet demand,” Savills, a real estate consultant in Portugal, said, according to the agency.

The number of available apartments in Lisbon reached a 15-year low in 2022, according to Confidencial Imobiliario, which collects data on the Portuguese real estate market. Many local families were left behind and pushed into substandard rental apartments outside Lisbon.

Real estate speculation fueled by tax cuts

The reason why foreign investors fled to the Portuguese capital: Demand was increased by tax incentives. Following the financial crisis, the government abolished rent controls and introduced the “golden visa.” This paved the way for immigrants to quickly obtain a residence permit. The condition for this was to invest 500,000 Euros in housing. Tax reductions were also introduced.

At the same time, sufficient housing options could not be created. No wonder prices are through the roof. The current government has promised to stop providing incentives to foreigners. The special “login program” has been removed. However, it is not possible to stop the fueled real estate speculation so quickly.

“Ultimately, the country’s warm climate, beautiful beaches, lifestyle and relatively low cost of living will continue to attract the interest of foreign investors,” Pedro Coelho, managing director of real estate investment firm Square Asset Management, told Bloomberg. (euro)

Source :Blick