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According to the National Statistics Institute (INE), the sale of houses to international buyers fell by around 20% at the beginning of 2024 compared to the previous quarter.
What stands out is that this drop in the purchase of houses in Portugal by foreigners coincides with the end of the regime for Non-Habitual Residents (RNH), under the old terms, and the end of golden visas for real estate investment. This impact of the end of tax benefits on the residential market had already been anticipated by the experts interviewed by idealista.
Foreign buyers
INE data reveals that 33,077 homes were sold in Portugal in the first quarter of 2024, 4.1% less than the same period last year and 3.1% less than the previous quarter. It is also observed that this drop in house transactions was more significant for foreign buyers than for Portuguese buyers.
Buyers residing in the national territory: purchased 31,010 homes, 3.1% less year-on-year and 1.6% less compared to the previous quarter. This is the lowest number since the second quarter of 2020 when the Covid-19 pandemic was declared;
Buyers residing in the European Union (EU): purchased 989 homes at the beginning of 2024, a number 22.1% lower than that observed a year earlier and 19.8% lower than at the end of 2023;
Buyers residing in countries outside the EU: purchased a total of 1,078 homes in this period, 11.9% less year-on-year and 22.4% less compared to the previous quarter.
These numbers show a clear drop in the sale of houses in Portugal to foreign citizens at the beginning of 2024, such that Portuguese people now represent 93.8% of the total number of transactions, “the highest relative weight since the first quarter of 2022”, highlights the institute. You have to go back to spring 2021 to find such a low number of homes sold to foreigners.
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My wife and I got in just under the wire for NHR--our application was in process when it was cancelled and we only found out weeks later we'd be grandfathered in.
Without NHR, it made little to no financial sense to move and we likely would have chosen somewhere else.
Maybe some Portuguese wish we'd missed out so a local might buy the apartment we bought. I understand.
But I'm thankful every day that we just made it. Portugal is such a wonderful place.
By Shawn from Other on 24 Jun 2024, 22:56
Well done to you, we have missed out as our Uk house sale did not go through but now its sold we are looking elsewhere as without the NHR there is no advantage in lovely Portugal. We have found opportunities in Spain that almost match the NHR which financially are now better so its odd Portugal cancelled theirs and the neighbouring country has now become more beneficial
By kevin King from UK on 25 Jun 2024, 10:22
I am surprised at comments that talk about financial sense. Portugal has so much more to offer! Does that mean in 10 years when the ‘financial sense’ is gone they will leave?
By Gerald Eddy from Porto on 25 Jun 2024, 11:59
Agree with @Shawn.
Part of the drop is just the market cooling. Look there were fewer sales to all groups (national, IE, other).
Yes ending GV and NHR will have an effect. PT is in competition with other countries for direct foreign investment. It helps pay for schools, roads, creates jobs and yes... also causes price competition for high-end homes.
By Brian Sanders from Other on 25 Jun 2024, 12:52
I wait more than 6 months to have an answer from finanças regarding my NHR request. Everytime I send a email the answer is....under investigation.
By Philipe from Algarve on 25 Jun 2024, 21:01
So what does this mean for the Portuguese economy? Are locals buying more properties than before, are the prices cheaper?
By Choc from Algarve on 26 Jun 2024, 09:28
This article doesn't highlight that all NHR buyers will be classified as Portuguese - they are based on tax residence. So any impact of NHR is camouflaged!
By Tony H from Lisbon on 26 Jun 2024, 10:06
As an immigrant with roots in Portugal, I believe the GV situation made a few people very wealthy (sellers) and priced out locals from major cities. I hear the comments amongst the locals when I am out and about and how they wish foreigners would leave so that they can have their place back. This is a very delicate issue. Yes, the government needs the income coming from the sales of these places. But are they really investing the funds properly? Perhaps the government should use the funds to build more affordable housing, for the shortage is massive. Moreover, making the system more transparent so that the populace can understand the benefits and drawbacks.
By Marcos Ferreira from Lisbon on 26 Jun 2024, 11:32
Sensible commentary from Marcos. Democracy requires the approval of the majority. Not a minority of beneficiaries. But it's a poisonous chalice. Encouraging the most successful, educated, intelligent, capable or wealthy (not always the same people) to relocate may result in mediocrity and poverty. Portugal did a deal with the devil for 15 years but there will be winners and losers. And consequences, of course. All economic distortions and manipulation does this - the balance is very tricky to achieve. And too much of a good thing for a minority will result in discontent and instability (even if justifiable on a temporary basis). Another financial crisis and more hungry may force desperate measures again.
By Jo Walker from Lisbon on 26 Jun 2024, 22:22
House prices have been on the rise world wide for the last 15 years, inflation all over the world made material prices a lot more expensive, its so easy to blame foreigners for the rising prices. In the United states house prices more than doubled since covid! World economies have slowed down since then, and real estate slowed down as a result from high interest rates all over the world, Portugal is no different than the world, to keep blaming foreigners for the government failures is just shameful. This article does not mention that the drop of foreign buyers resulted in increased local buyers or reduced prices, there are a lot of ways the government can help citizens in buying their first home, how about create better programs and favorable interest rates for first time buyers. its a shameful tactic to scapegoat the foreigners for continuous failures of the government.
By Ninim from Algarve on 27 Jun 2024, 03:40
As a Portuguese living abroad, I am happy that the government took action on this issue. It is was a mess that so many wealthy people from abroad took advantage. It fundamentally transformed Lisbon in an expensive and out of control real estate market. I see US nationals have taken advantage of this, and seeing what is happening in the US market wise, I am glad that this was stopped. It is shameful that so many people in Portugal were blocked from the property ladder because some people want second homes abroad. The housing market in the US is out of control and we don't need that crisis deepened in Portugal.
By Pedro from USA on 28 Jun 2024, 17:39
Please remember that, at last count, there were approximately 12,000 residents from the US. I believe that more
than half of them have not purchased real estate. To blame Americans for the rise in housing costs is unfair.
By Debbi from Lisbon on 01 Jul 2024, 02:31