Portugal Property Valuation Rises
Data released by the National Statistics Institute, the average price per m2 bank valuation for properties in Portugal increased again in August with the price per m2 now at its highest level since July 2012.
Specifically the Algarve boasts the highest valuation levels in the country at €1,246 per m2 against an average national value in August of €1,032 per m2 which is 21% above the national average.
The overall national level is the highest level since July 2012 after a decline to below €1,000 per m2 in early 2013, the lowest figure since records began.
The region with the lowest level was in the rural centre of the country where the average valuation was just €851 per m2 which is 17.5% less than the national average.
These valuations are critical for those requiring finance or mortgages from the Portugal’s banks in order to purchase a property. The banking group and system is still under severe pressure for the strict conditions and stipulations required for borrowing currently as the banks juggle to lend at the same time improve their balance sheets.
The banks still promote up to 80% lending of their property valuations. But in reality there is a lower priced valuation on properties enabling the banks to increase the loan-to-value ratios thus reducing their own risk and putting the onerous onto buyers to find the additional shortfall.
So all those hesitant buyers beware…the market has been for the past months been experiencing an up turn in activity, significant increase in demand and already a lack of supply, coastal premium areas are already achieving higher sales prices than last year and now banks are reporting a rise in price per m2….