Housing Prices Rise – Says INE

20 September 2017

The Housing Price Index (IPHab) increased by 8.0% year-on-year in the second quarter of this year and increased 3.2 % compared to the first quarter, according to figures released today by the National Statistics Institute (INE).

According to the INE, this year-on-year increase “is justified by the acceleration of new housing prices, which grew by 5.4 %, 1.2 percentage points (pp) more than in the previous quarter, reaching the highest value since the third quarter of 2014.”

Divergence in the evolution of prices: new vs existing housing

“This was the second consecutive period in which there was an acceleration in the prices of new homes, which contrasts with the trends observed for existing housing, whose year-on-year rate of change went from 9.2% in the first quarter of 2017 to 8.9%,” the institute noted.

As it points out, this was the “first time since the last quarter of 2015” in which the growth rate of existing housing prices slowed down.

Regarding the previous quarter, IPHab increased 3.2% (2.1% in the first quarter of 2017), which made this period “the second consecutive quarter in which the price acceleration was observed. New housing registered greater increases (3.3% compared to 0.8% in the first quarter of 2017) than in existing housing (3.2% in the second quarter and 2.5% in the first quarter of 2017).”

Between April and June of 2017, IPHab’s annual average rate of increase reached 7.8%, a new high for the series, with the annual average increase in prices of existing and new housing being 9.1 % and 4.2%, respectively.

An increase in the number of transactions

36,886 units were traded in the second quarter of 2017, corresponding to a year-on-year increase of 16.1% and an increase of 4.9% over the previous quarter.

For the same period, sales grew by 23.3% year-on-year and by 6.3% compared to the previous quarter, to around €4.6 billion, of which close to €3.7 billion were transactions relating to existing housing.

Original Story: Lusa / Diário Imobiliário

Translation: Richard Turner