House prices continue to rise, but this growth slowed again in the third quarter of this year, continuing the behavior already seen in the previous quarter. At the same time, the number of sales continues to decline, although there is already a recovery from the second quarter, when economic activity was practically paralyzed due to the pandemic.
The data was released on Tuesday, December 22 by the National Institute of Statistics (INE), which reports that house prices rose 7.1% in the third quarter of 2020, compared to the same period last year. , below the rate of 7.8% which had been recorded in the second quarter. This is the slowest annual growth rate in the past four years.
Also in quarterly terms, there is a marked deceleration in prices. Between the second and third quarters of this year, house prices almost stagnated, rising 0.5%, the slowest growth rate since 2015. This trend is reflected in new and used housing . In the first case, prices rose 5.8% year on year, while in second-hand housing the growth rate was 7.4%, values which in both cases are lower than previously recorded rates.
Despite the slowdown in prices, there is a recovery in the number of transactions. A total of 45,136 homes were sold in the third quarter, a 35% increase from the second quarter, when the number of transactions declined. Despite this, compared to last year, the number of sales made in the third quarter fell further by 1.5%.
Despite the recovery in sales, the average price of homes has fallen. Sales of 45,136 homes amounted to 6,752 million euros, which means that the average price of each sale was 149,500 euros, compared to 154,000 euros recorded in the second quarter.
Lisbon and North lose weight. Centro, Alentejo and Madeira win
One of the effects of the pandemic, already well known in the real estate market, is the loss of weight of large urban centers in total sales and the increase in the relevance of the interior regions.
In the third quarter, according to the INE, 60.9% of total households sold were concentrated in the Lisbon metropolitan area and in the North region, the lowest relative weight since the first quarter of 2015. “This mainly contributed to the 2.5 percentage point reduction in the relative regional share in the Lisbon metropolitan area ”, justifies the INE.
In contrast, the Center was the region with the largest increase in relative weight, 1.5 percentage points, representing 21.3% of total sales. “The Alentejo and the Autonomous Region of Madeira were the other regions which recorded year-over-year increases in their respective relative shares”, while the Algarve maintained the same share, 7.3%, and the Azores recorded a slight decrease.
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