The period of recovery of the Portuguese real estate market since early May seems to be slowing down, says a monthly report by property consultants Imovendo.  

The national property market has proven its resilience in recent months, considering the challenges brought on by the pandemic (read more here). However, according to this latest report, seasonality and a macroeconomic cooling are having an effect on the housing market. 

Summer has historically been considered a dynamic period in real estate demand, with a tendency to cool down until the end of the year. This year, the trend is expected to be even more significant, given that much of the demand was the result of investment decisions prior to confinement. 

Meanwhile, the national economy is seeing a contraction of the GDP, rising unemployment rates and limited recovery of the tourist market. The area that experienced the most dynamic has been residential demand, with buyers looking for more living space and outdoor areas, such as gardens, balconies or small terraces (see here). 

“Many professionals have reported good results in the last quarter and, certainly for this reason, since the end of May, 300 new real estate companies have been created, an impressive number that represents close to 5% of the sector,” says Manuel Braga, CEO of Imovendo. “It appears to be a counter-cycle, but it puts added pressure on a sector that faces an uncertain future.”  

The report concludes that, despite the resilience of the property market in Portugal, there will be three key aspects in the coming months: gradual adjustment of house prices, further reliance on technology as a sales tool, and the need to find new strategies for marketing properties. 

For advice on buying or selling in the Algarve and on the best times to invest, please get in touch with the team at Algarve Home Sales here.