Bank Valuations for Housing Reach New Historic High in August
The median value of bank valuations for residential properties in Portugal reached a new all-time high in August, standing at 1,965 euros per square meter, according to data released this Monday by the National Statistics Institute (INE). This marks the 21st consecutive month of increases, continuing a growth trend that began in late 2023. The latest figures show a monthly increase of 1%, or 20 euros, compared to July 2025.
The data, compiled from approximately 31,700 bank valuations conducted in August for the purpose of granting mortgage credit, serves as a key indicator of the property market's momentum. The INE's methodology involves collecting data from the country's main financial institutions. Despite the rise in value, the number of valuations processed saw a month-on-month decrease of 6.4% and a slight year-on-year dip of 0.3%.
In year-on-year terms, the median valuation value registered an 18.1% increase compared to August 2024. This represents a slight deceleration from the 18.7% year-on-year growth observed in July, but it nonetheless confirms a sustained and significant appreciation in how banks are valuing properties. This trend has direct implications for the housing market, influencing both lending capacity and property transaction prices.
The Greater Lisbon (Grande Lisboa) region continues to lead the nation with the highest property valuations, underscoring its position as the country's most valuable real estate market. For apartments, the median valuation in Greater Lisbon was recorded at 2,991 euros per square meter. The Algarve followed as the second most expensive region, with a median of 2,681 euros per square meter. In contrast, the Centro region presented the lowest valuation at 1,472 euros per square meter.
When analyzing year-on-year growth, the Península de Setúbal region demonstrated the most expressive increase, with valuations surging by 26.4%. This highlights a growing dynamism in the markets surrounding the capital. No region reported a year-on-year decrease in apartment valuations.
Across the country, apartments as a category saw their median valuation rise to 2,269 euros per square meter, a substantial 22.6% increase from August of the previous year. One-bedroom (T1) apartments had a median valuation of 2,914 euros per square meter, while two-bedroom (T2) and three-bedroom (T3) apartments were valued at 2,344 euros and 1,957 euros per square meter, respectively.
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For the housing (moradias) segment, the national median valuation stood at 1,430 euros per square meter, reflecting a 10.3% year-on-year increase. Again, Greater Lisbon recorded the highest values at 2,705 euros per square meter, with the Algarve close behind at 2,479 euros per square meter. The lowest valuations for houses were found in the Centro and Alentejo regions.
An analysis by the INE also revealed significant regional disparities when compared to the national median. Valuations in Greater Lisbon were 50.5% above the national median, while the Algarve and the Setúbal Peninsula were 33.7% and 19.6% higher, respectively. Conversely, interior regions such as Beiras e Serra da Estrela and Alto Tâmega e Barroso showed valuations more than 50% below the national median.
Industry experts note that these figures reflect a combination of persistent demand, both domestic and international, and a constrained housing supply, particularly in major urban centers. The continuous rise in valuations, while positive for current homeowners, presents an ongoing challenge for new buyers entering the market and places continued pressure on housing affordability.
The government and financial authorities continue to monitor these trends closely. While the market has shown resilience, the pace of growth in valuations is a key factor in assessing overall financial stability and the health of the real estate sector.
The next report from the INE is anticipated to provide further clarity on whether the slight deceleration in year-on-year growth will continue into the autumn months, or if the market will maintain its strong upward pressure on valuations.
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