How long does it take to sell a house?

At the beginning of 2019, a year of changes was expected regarding the real estate sector. This sector has been gradually growing since 2009, not just in terms of transactions, but also in the number of agencies in the country. In June 2019, the number of real estate agencies was 6.864, an increase of 14% concerning the same month a year earlier. This event contributes to the real estate market growth.

The most noticeable changes since the beginning of 2019 are especially in the time from the solicitation to closing the deal. Last year it took an average of 45 days to complete a deal, this year the average has increased considerably to 90 days.

We can link the lack of houses across the country to this event. The offer has been decreasing, and the low stock does not satisfy the demand. Prices per square meter also influence the decision, although they are beginning to fall compared to previous years, they aren't yet conveniently regulated. The middle/middle-low class is who most feel this problem, and as a consequence end up postponing buying a house to a more favourable time. The regularization may not be very far from happening, as foreign investors are already starting to look at the market with different eyes. Soon the luxury house market will move to the background, and investors will focus more on the middle-class market. Some experts believe this is not due to the new low-income housing program, but the market will flow in this way. According to some experts, it is still too early to analyse changes made by the government.

To be contextualised about the new housing politics in force since June, follow this link.

According to INE, the new construction cost has been gradually increasing. Compared to last year, we can observe an increase of 0,6% on the construction materials and 4,1% on the labour force, compared with the same period of the previous year. The new constructions began to get a new life after the crisis years. For the middle/upper classes, this new dynamic came to meet the needs. With the financial help from the banks, the construction sector began 2018 with more conviction. Just this year, homes are getting ready to move in, giving the real estate market room to turn to faster responses.

There was an increase of 6.3% in the allocation of housing loans in the first 4 months of the year compared to last year. This is an unusual situation, for the fact that the Banco de Portugal is hindering the housing loans to the national banks. For the first residence, banks may only loan 90% of the property value. For loans with other finality that isn’t for the first residence, banks may only lend 80%. There is a recommendation by Banco de Portugal to repay the loan in a maximum of 40 years, ie for a mortgage and mortgage-backed credit.

If you need any housing loan information, follow this link or contact Casas Do Barlavento, we are available to help in this task.

Further changes in the real estate sector are expected, especially if foreign investors are betting on a new, more middle-class market segment. New constructions, now restored from the times of crisis, could have an impact on housing values and are likely to be regularized.