Foreign investment channeled to the housing segment in Lisbon decreased 19%

Foreign investment channeled to the housing segment in Lisbon decreased 19%

Foreign investment in housing in the Lisbon Urban Rehabilitation Area (ARU) totaled 324.7 million euros in the first half of this year, 19% less than in the second half of 2019, even before the start of the pandemic. It is the lowest amount of foreign investment recorded since the first half of 2018.

This investment amount concerns the purchase of 625 residential properties in the capital's ARU, -28% compared to the second half of 2019, compared to the 870 properties traded at that time.

According to data compiled by Confidencial Imobiliário (Ci), which cover housing transactions carried out only by individuals at the Lisbon ARU, activity in the first semester of this year is below any of the semesters of 2020, both in number of operations and in investment amount. The drop is around 15% in the volume of investment and 20% in the number of properties transacted.

Foreign investment now represents 31% of residential investment in the Lisbon ARU, which compares with the share of 37% before the pandemic, and 40% registered over the past year. In the first half of this year, the Portuguese invested 726 million euros in 2,018 properties in the Lisbon ARU, 5% more than invested in 2019 and 25% more than in 2020.

Even so, Ci highlights that foreigners increased the average amount per operation, placing their average investment ticket this semester at 521,100 euros, a maximum level for this audience. This value is more than 51% above the average amount invested by the Portuguese in the same period, in the order of 345,900.

Until June, individuals of 58 different nationalities had invested in Lisbon, with the French leading with 22% of the volume invested by foreigners, followed by the British, with 14%, the Chinese, with 12%, the Americans, with 8%, or Brazilians, with 7%.

According to Ci, the behavior of these buyers compared to pre-Covid is, however, quite different. While the Chinese and Brazilians, which in the last half of 2019 led foreign investment, reduced the volume invested by about half, the French and the British increased their activity (growths of 57% and 38%, respectively, compared to the second half of the year of 2019), the same being true for the North Americans, who almost doubled their activity between the two periods.

It is the parish of Santo António that gathers the largest volume of investment in housing in the ARU de Lisboa, with 15% of the amount invested (48 million euros), despite having lost representation compared to the pre-Covid, when it represented 21%. Next are Avenidas Novas, with 47 million euros invested by foreigners (14%), in addition to Arroios and Estrela, with 45.5 and 44 million euros invested, and shares of 14%. In Misericórdia, 36 million euros were invested in housing, 8% of the total.

It should be remembered that the ARU in Lisbon covers practically the entire territory of the city, excluding some areas such as Parque das Nações, Laranjeiras or Alta de Lisboa. Taking this into account, for the purposes of this analysis, all parishes in the city are considered, excluding those in Parque das Nações, Lumiar and Santa Clara.

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