This study comes at a time when the country has been facing, for several years, a complex, persistent and multifaceted structural housing supply shortage that requires a rigorous understanding of market dynamics and the factors shaping new developments.
An integrated view of the market
Throughout this study, we analyze the residential growth of the main municipal markets in Greater Lisbon and Greater Porto over the past decade, addressing key questions such as where development has most concentrated and why, which areas have seen the highest levels of licensing activity, and how demographic trends have influenced, and will continue to influence, residential development.
The analysis also covers the evolution of both sales and rental prices, identifying distinct territorial patterns as well as the factors driving growth or stagnation across different markets.
New models and the role of public policy
The study also explores the potential impact of Build-to-Rent (BTR) and reviews the main government measures recently approved (but not yet enacted) aimed at stimulating housing supply.
Resilient markets, structural challenges
The findings show that, over the past ten years, the residential market has been dominated by second-hand housing transactions, reflecting the persistent shortage of new supply.
Lisbon and Porto have consolidated their position as strong markets, with solid demand supporting higher price levels and sustaining the viability of new development, albeit with smaller unit sizes. In contrast, peripheral markets face greater challenges: while housing needs are increasing, particularly among younger households, effective demand remains constrained by income levels, pricing, and the lack of available supply.
The limited development of new housing, particularly large-scale projects, is expected to exacerbate these dynamics in the coming years, with a direct impact on housing affordibility in both the ownership and rental markets.
In this context, it becomes essential to explore new development models that enable greater scale, shorter delivery timelines, and more efficient construction costs.
In the rental market, the viability of Build-to-Rent largely depends on its recognition as a distinct product from for-sale housing, requiring a tailored fiscal, regulatory, and planning framework.
Additionally, the study highlights relevant opportunities in certain suburban areas, where population ageing may lead to the release of existing housing stock, increasing supply without relying exclusively on new development.
