In the last quarter of 2023, 33,200 homes have been sold in mainland Portugal, consolidating the fourth consecutive quarter with sales of around 33,000 units. This pattern of behavior represents a reversal of the downward trend seen at the beginning of last year.
According to projections made by Confidencial Imobiliário based on transactions reported in the SIR database - Residential Information System, this behavior suggests that the market is recovering from the shock of rising interest rates.
3rd and 4th quarters showed signs of positive development
Although with residual oscillations of +1%, the 3rd and 4th quarters of 2023 showed signs of positive evolution, consolidating the trend of recovery in transactions after the initial impact of the interest rate hikes. This recovery is especially evident in the decrease in the year-on-year variation in the number of transactions. As a result of the effect of the stabilization of transactions throughout the year, this indicator went from -20% in the 1st quarter to -9% in the 4th quarter.
It should be remembered that the first quarter of 2023 continued the cycle of sharp quarterly falls that began in mid-2022, when interest rates resumed their upward trend after years in negative territory. In that initial period of the year, transactions fell by 9% to around 33,000 homes sold, a two-year low. Once this adjustment had been made, the course of 2023 ended up with a stabilization of demand levels, with the second quarter sustaining the transaction patterns of the previous period and the second half of the year showing even a positive performance.
According to the words of Ricardo Guimarães, director of Confidencial Imobiliário, "the more favorable behavior of interest rates in the last months of the year – with the first signs of a trough in November and what appears to be a consolidation";
The slowdown in interest rate rises already this year should have a more visible effect on sales dynamics only in 2024, although it may already have had some positive impact on market confidence.
At the end of 2023, it is estimated that there was around 131,700 residential sales in mainland Portugal, of which 88% will be in used housing and the remaining 12% in new housing. Without prejudice to the market's stabilizing trajectory over the course of the year, the aggregate annual volume for 2023 is 17% below that recorded in 2022.