Construction in Portugal Up in the First Quarter of the Year

7 May 2021 – Ana Custódio

March saw a new high in the average value of bank valuations of homes as part of the mortgage application process.

According to a survey by AICCOPN (the Association of Civil Construction and Public Works Industries), the construction sector reported a 10.8% increase year-on-year in cement consumption in Portugal in the first quarter of the year as cement consumption reached 385,500 tonnes, a ten-year high for the month.

According to AICCOPN, in the first quarter of 2021 and according to an estimate released by INE (National Statistics Institute), reflecting the effects of the containment measures, GDP fell by 5.4% compared to the same three-month period the previous year and by 3.3% compared to the last quarter of 2020.

Bank valuations of housing reached a new high in March 2021, with an increase of 6.8% compared to the same month of the previous year.

The issuance of building licenses by the country’s municipal councils, an indicator of future activity in the building construction segment, fell by 11.6% due to reductions of 9.1% in new construction and 18.1% in rehabilitation works. At the same time, the number of contracts signed in the civil engineering sector rose by 43%.

Also in this quarter, the expected y-o-y decrease in public works tenders materialised. March of last year saw a high level of major public works tenders, particularly the new metro lines in Porto and Lisbon and the modernisation of the Beira Alta Line, which totalled 872 million euros. Thus, public works tenders totalled 969 million euros in the first quarter of the year, 42% less than the €1.663 billion in the first three months of 2020.

Translation: Richard D. K. Turner