Jorge Garcia, Real Estate specialist, analyses recent developments.
Source: Author
Author: Jorge Garcia, Real Estate Specialist
New conflicts and the real estate market; barometers and thermometers in Portugal
In the face of a new conflict in the Middle East, it will be important to pay attention to the figurative gauges of pressure and temperature in the real estate market in Portugal. Twenty-six days had passed since the beginning of yet another armed conflict with global implications. At the National Real Estate Awards – the “Oscars of Real Estate”, an initiative by “Magazine Imobiliário”, the sector celebrated another year of dynamism. An edition that recorded a record number of 92 entries and 50 finalists. For more than 10 years I have had the privilege of being present at this event.
It is at the cocktail and awards dinner that we seek to scrutinise the market from the supply side; it is in the informality of opinions that we try to perceive the confidence of operators. In the residential segment, the main award was given to the “Condes de Caria” development, a rehabilitation of residential heritage of historical value adapted to contemporary housing, on Estrada das Laranjeiras, in Lisbon.
Also distinguished at a regional scale were “Greenstone”, in Foz do Douro, Porto, “Villa Sanches”, in Campo de Ourique, Lisbon, and “Natura Village”, in Vilamoura. Developments focused on the “premium” segment, a refuge for real estate development in a scenario of excessive bureaucracy, high construction costs, difficulties in obtaining licensing and shortage of labour. The big winner of the night was MACAM – Museu de Arte Contemporânea Armando Martins, a cultural facility that integrates a contemporary art museum and a hotel unit in a historic and cultural area of Lisbon, between Alcântara and Belém. It will be in a complex international context that SIL - Salão Imobiliário de Portugal will take place.
With 20% more exhibitors compared to the previous edition and increased expectations regarding the presence of representations from the Middle East. In recent years we have also been there: in 2020, when operators challenged the uncertainties caused by the COVID-19 pandemic; in 2022, when the Russian invasion of Ukrainian territory caused significant inflationary tensions; and in 2023, when high interest rates sought to control inflation. On all these occasions, the market reacted, reinvented itself and recovered. This time will be no different.
Public policies and structural challenges
In 2026, when decision-makers are alert to the results of the diagnoses, a new uncontrollable external setback now arises. With the approval of the State Budget and the “Housing Law 2026”, which regulated fiscal reforms, housing has become a structuring political priority.
The package of measures announced responded to some of the recognised vulnerabilities. But solutions to the crisis of access to affordable housing are neither easy nor quick. The Electronic Platform for Urban Planning Procedures and the Electronic System for the Issuance of Opinions are important steps in the digitalisation of municipalities and the simplification of decision-making processes.
The creation of the CIA figure - Investment Contracts for Letting is an important instrument. Guiding the speed of decision-making and creating new investment instruments in affordable housing are relevant measures. But if the legislation governing urban planning licensing remains unclear, if rules, procedures and interpretations persist across the 308 municipalities and external entities, the web will continue to feed the “bureaucratic monster”. Between 2024 and 2025, 114,500 licensing applications were submitted, with only 64% of these projects proceeding to construction.
PRR funding for the construction of affordable housing will have mediocre execution. Support for reconstruction after the storms that hit our territory is significantly delayed.
The continued reliance on IHRU as a public partner in housing policies, particularly in the CIA, does not bode well. If fiscal and technological shocks are important, confidence in investment and a cultural shift in public administration are essential.
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