Portugal's Property Sector needs 70,000 new Homes to keep up with Demand

According to Reis Campos, the president of the Construction and Public Works Association, and Luis Lima, head of the Estate Agents' Association, Portugal needs at least 70,000 newly build homes to satisfy demand. Prices for homes and rents, so Luis Lima, are steadily rising, especially in cities like Lisbon and Porto, because there is so little property on the market. The estate agency's association has conducted its own study into the problem and is blaming the construction sector for not keeping up with demand. More than 50% of demand falls to Lisbon and Porto, according to Lima.

While at the start of the century more than 100,000 new homes were built each year, the recession reduced this to just 17,000 in 2011, and a mere 7,000 to 8,000 homes per year between 2013 and 2015. The number of new builds has been growing since 2016, said Reis Campos.

Demand, so the Portuguese Association of Real Estate Developers and Promoters (APPII), is coming especially from the middle classes, from French and Nordic buyers as well as domestic home buyers. While foreign buyers are looking for a second home, national buyers are looking to buy "a step up" the housing ladder.

APPII also stated that people are beginning to buy outside property hotspots, which should give the construction sector time to build up housing stock for a more "sustainable and long-term market".

Meanwhile, Faro Town Hall is investing some 1.4 million euros in urban green spaces to make existing housing more attractive. The Algarve's town's main parks and gardens are to get face lifts. The project will see paths, urban furniture and illuminations updated and new trees being planted. Work is to start at the end of next year and should be completed by the end of 2021, according to Faro Mayor Rogério Bacalhau.