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residential Market News: Portuguese Real Estate Intelligence

Interest Rates on Mortgages Falls to 0.897%, Another Record Low
21 January 2021 The implicit interest rate on residential mortgages for the acquisition of a home declined for the fourth consecutive month in December to 0.897%. According to data provided by the National Statistics Institute (INE), the figure represents a record low for the series since the INE began tracking in January 2009. The interest rate for contracts signed during the last three months  fell from 0.857% in November to 0.790% in December. The average monthly instalment also fell by one euro to 227 euros in December, following an equivalent drop in October. Original Story:  Eco Sapo Translation: Richard Turner
 
Housing Prices 1.8% Higher than Before the Pandemic
19 January 2021 According to Confidencial Imobiliário’s Residential Price Index, housing sales prices on mainland Portugal rose by 1.8% in December, compared to the beginning of the pandemic in February. Compared to the same month in 2019, the increase reached 4.8%. Additionally, December posted the most significant monthly change during the pandemic, 1% compared with November. Housing sales prices are showing signs of stabilising. Price changes had varied between -0.2% and 0.9% since March when the effects of Covid-19 began to be felt in Portugal. The figures reflect the housing sector’s resilience in the face of the pandemic, though short-term trends evidence a slowdown compared to the market’s previous pace in 2019 when prices were rising by an average of 1.2% per month. Original Story: Vida Imobiliária Translation: Richard Turner
 
ZIP Project: Banks Sell Portfolio 4400 Homes at 10% Discount
19 January 2021 - Ana Custódio According to an article in Economia Online, Portuguese banks are preparing to sell the ZIP Project, a portfolio 4,435 homes. The assets primarily comprise occupied rental housing valued at a total of 360 million euros. The buyer is a consortium formed by the Tikehau and Albatross investment funds, which has agreed to acquire the full portfolio at a 10% discount. The funds will pay between €300 million and €320 million for the portfolio, and the parties expect to finalise the deal during the first quarter of this year. The portfolio mostly consists of flats located in and around of Porto (1,000), Setúbal (870) and Lisbon (740). The value of assets in those three regions adds up to more than 200 million euros or more than half of the total portfolio. The assets generate an annual income of 14.6 million euros and could reach €25.8 million if 90% of the home were leased. Proceeds from the sale will be distributed among the participating financial institutions according to their holdings. The properties are included in two real estate investment funds managed by Norfin. The principal investors consist of Novo Banco (which holds the most considerable stake in both funds), Caixa Geral de Depósitos, Montepio, BCP and Santander Totta. Translation: Richard Turner