Latest RICS survey signals recovery for the Portuguese market is not too far off

Signs that the Portuguese property market is close to turning the corner come from the October housing market survey from RICS, which supports the idea of stabilising sales market conditions, alongside relatively flat lettings market activity.

In the sales market, the agreed transactions series remained stable in October, while the new buyer enquiries data maintained positive momentum for a third month running.

RICS Senior Economist, Josh Miller said: “The October survey results again convey the message of a stabilising sales market and while recent economic data has also been encouraging, this will have to be sustained through 2014 before we are in a position to talk about a genuine residential property market recovery.”

That said, this month’s confidence reading is still fairly close to the series high level. Although house prices continue to fall, the net balance indicates the pace has moderated significantly since the back end of last year. Alongside this, sales expectations for the coming quarter are still positive. On balance, the current market dynamic appears to be much less negative than at any point in the survey’s three year history.

In the lettings sector, tenant demand appeared flat whilst new landlord instructions fell. Meanwhile, lettings volume expectations point to little change occurring over the next quarter. Results in recent months point to more subdued lettings sector activity on the horizon.

In keeping with recent surveys, rents continue to fall and respondents are still anticipating rents to deteriorate over the coming quarter, albeit to a lesser degree than was the case six months ago. In terms of the regional outlook, Lisbon appears to be leading much of the improvement in the sales market. In contrast, the lettings sector in Porto has seen some firming, with tenant demand and landlord instructions particularly strong relative to the headline results.

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