Apparently more people are choosing to buy previously owned properties in Lisbon rather than brand-new homes. This thought to be due to the sheer number of previously owned properties on the market, and their pricing.
Nearly three quarters of homes for sale in Lisbon during the fourth quarter of last year, and the first quarter of this year were previously owned. Another reason for their popularity is that many are bank owned repossessions, and as such are more likely to qualify for mortgages from the bank.
This has led to a fall in the number of licenses issued for new construction, and the number of new builds in Portugal is falling. Brand-new homes tend to be offered at higher prices than previously owned homes, and as a result can be more difficult to sell, taking several months longer than a second-hand property. At the moment a previously owned home is taking around 16 months to sell, whereas in 2007 the sale of such property took just seven months.
There is also the question of location, as homes within the city center are in shorter supply, and new builds tend to be more expensive and smaller in comparison to previously owned properties. While some people may be opting for bank owned properties due to the ease of getting a loan, others are taking advantage of the downturn in the market to buy homes for cash.
They are purchasing properties from homeowners desperate to sell, and are then renting out these homes. It estimated that between half and three quarters of all property transactions at the moment are being completed without the need for any financing.