The August 2017 RICS/Ci PHMS results show a lack of supply is becoming an increasingly prominent feature of the market, with new instructions to sell again declining over the month. This continues to exert upward pressure on prices which are expected see further strong gains over the coming twelve months. Likewise, in the lettings market, rents remain on an upward trajectory given the mismatch between rising demand and falling supply.
Focussing on the sales market, demand rose at a healthy pace with a net balance of +24% of respondents reporting an increase in new buyer enquiries during August (compared with +17% in July). Set against this, the volume of fresh listings coming to the market declined for the fifth successive report. Furthermore, the pace of decline over the latest month was the sharpest since 2013.
With the imbalance between supply and demand building, house prices continue to rise firmly across all areas. In terms of the regional breakdown, house price inflation remains strongest in Lisbon, while the Algarve has seen some moderation in the pace of growth recently (in net balance terms). Looking ahead, respondents envisage headline house prices rising by around 4% over the next twelve months. Over the next five years, price growth is anticipated to accelerate, averaging 5%, per annum, in each region covered (Lisbon, Porto and the Algarve).
Source : RICS