The prime residential market should grow up to 1.9% this year, an increase that is, however, below the one seen in 2021 (7.6%).
The real estate sector was one of the best responders to the Covid-19 pandemic, namely the luxury segment. According to consultancy Savills, the value of the world prime residential market rose 6.9% in 2021 and should continue to grow in 2022. In the case of Portugal, specifically Lisbon, the prime residential market is expected to grow by 1.9% this year, an increase that is, however, below that of 2021, which was 7.6%.
According to the World Cities Prime Residential Index study, prepared by Savills and which analysed the 30 largest global cities in terms of luxury residences, including Lisbon, the prime residential market worldwide is well positioned to achieve an average growth of 4.3% this year, the second highest value of the last five years.
Prime residential seen as a safe investment
“As economies begin to recover somewhat around the world and countries learn the best ways to deal with the Covid-19 pandemic and mitigate the negative impacts of measures to address the public health crisis, prime residential markets should continue to be seen as safe investments in 2022,” the consultancy said in a statement.
Quoted in the statement, Paul Tostevin, Head of World Research at Savills, comments that “28 of the 30 cities analysed are expected to grow in 2022, albeit at a more moderate pace than last year”. “Reduced interest rates and higher incomes have increased mortgage payment capabilities, while some cities (Miami, Dubai and Lisbon) have benefited from the flexibility of remote working, and the desire for more space. Alongside the return to office space, education and travel will also drive growth in all major cities,” he adds.
In the specific case of Lisbon, the study predicts that the capital’s prime residential market will grow this year by 1.9%, less than the 7.6% registered in 2021.
“On the balance of 2021, the national residential property market recorded a total recovery, with just over 200,000 homes sold and exceeding the values observed in 2019. Forecasts indicate that 2022 will be a year of full recovery from the effects of the pandemic, with the residential market maintaining its prominent place. Highly resilient and seen as a safe investment, the residential market will continue to see a positive evolution of prices in the luxury market, although at a more measured pace compared to previous years and with a trend towards greater stabilisation,” reads the document sent to the newsroom.