But according to new research, this boom is leading to growing social inequalities.
According to the study, the property market is experiencing an unprecedented period, with house prices rising well above wage trends.
Local lodging has also been said to have resulted in house price increases, as investors seek to cash in and earn returns well above those offered by financial institutions.
‘The new question of housing in Portugal’ is the theme of the fourth report of the Observatory on Crises and Alternatives that has now been released, whose findings are based on research conducted by researchers from the Centre for Social Studies (CES) of the University of Coimbra and the Institute of Geography and Spatial Planning (IGOT) of the University of Lisbon.
According to the study’s coordinator, Ana Santos, the property market “is going through an unprecedented historical moment, with housing prices growing continuously and substantially above wage trends, making housing ever less accessible to ever more groups of the population.”
Housing purchases driven by finance “has been turning itself into a mechanism [that is] ever more crucial in reproducing social inequalities, a result of strengthening of the economic and political weight of property,” Santos explains.
She also cites the new law on rental contracts in urban areas, approved in August 2012, as a factor in accelerating property sales.
“Although the objective explained [at the time] was to stimulate urban rentals, the result has been the acceleration [of the end] of rental contracts, with a view to the sale of buildings or new uses, such as the local accommodation,” she writes.
Since 2014 there has been an accelerated growth in the number of transactions, the vast majority of existing apartments, at the same time as the number of apartments registered as local lodging multiplied by five, to 14,500.
Other measures have also encouraged external demand, such as the ‘golden visa’ ARI programme to fast track residence permits for major investors, which came into force in October 2012.
In addition, she recalled, EU citizens can benefit from a specific income tax regime for non-habitual residents, further adding to demand.
These factors have, according to Santos, contributed to housing prices rising steadily in Portugal, especially in Lisbon, Porto and the Algarve region.
In related news, an average of 500 properties were sold each day during the course of last year in Portugal. According to new figures, this number is the highest since the start of the global financial crisis in 2008.
Brazilians and French topped the list of foreign buyers, who as a whole, bought one in five homes sold across the country in 2018.
This follows latest data which showed that house prices rose by 15 percent during the third quarter of last year.