• Buyer enquiries see renewed dip in August

• Sales expectations still broadly flat

• Tenant demand starting to improve

The August 2020 RICS/Ci PHMS results suggest activity across the market continues to exhibit subdued impetus, with indicators on demand, sales and new instructions all in negative territory. Conversely, in the lettings market, demand now appears to be picking up, although this is yet to translate into an increase in rental pressures at the moment.

The headline new buyer enquiries gauge returned a net balance of -10% in August, down from a modestly positive figure of +9% posted in July. At the regional level, while monthly demand trends were reported to be broadly flat across Lisbon, respondents cited outright declines in both Porto and the Algarve. Back at the headline level, a net balance of -13% of survey participants noted a decline in agreed sales during August, with all regions seeing a fall in transactions over the period. Looking ahead, near term sales expectations remain in broadly neutral territory, signalling little change is anticipated over the coming three months.

Alongside this, new instructions to sell declined over the month following a more or less stable trend reported in July. What’s more, each region covered by the survey saw a renewed dropoff in sales listings coming onto the market during August.

With regards to house prices, a headline net balance of -7% of respondents saw prices decline in the latest results. This is down from a flat picture reported in the July feedback although the latest figure still suggests prices have seen very little movement of late. That said, price expectations did deteriorate in August, with the three-month indicator posting a net balance of -23% (down from -5% previously). Moreover, twelve month expectations now point to house prices falling by around -2% in aggregate.

The national confidence index (a combined measure capturing near term price and sales expectations) fell back to -12 in August having recovered somewhat to -2 in the July survey returns.

In the lettings market, tenant demand increased at the strongest rate (in net balance terms) since back in February. Even so, rents remain in decline and are expected to continue on a downward trajectory over the coming three months.

Source: Confidencial Imobiliário

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