Pedro Couto

The construction market in Portugal and the world

Pedro Couto

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Real Estate – the present situation and what we can expect

João de Sousa Rodolfo

Founder and CEO of Traçado Regulador

João de Sousa Rodolfo
2014 was a year of profound changes in the legislation that regulates spatial planning and urbanism, with consequences that are already visible and others that will only be gaugeable in the long term.
The legislation then produced made perfect sense. The 2011 censuses revealed 770,000 unoccupied houses, that is, more housing than families to inhabit them.
The government’s strategy in this case was to limit the growth of urban agglomerations by publishing the new law on the general bases of public policy for land, spatial planning and urbanism; to encourage urban regeneration by creating the first decree-law that placed it on a different level from new construction; to create local accommodation, which gave non-permanent use to the housing stock, enabling its renovation; and to increase real estate demand by attracting foreign capital and residents.
It all seemed to have been done well. We witnessed the regeneration of urban centres, the expansion of tourism demand and a powerful boost to the economy. But fate plays tricks on us. The pandemic showed us that teleworking was much more than a theoretical hypothesis, increasing the demand for housing on the outskirts of cities. However, housing developments grew mainly in developable space, which now no longer exists. Available plots will run out in a short period of time.
On the other hand, increase in demand for real estate has caused construction prices to soar, with a construction industry unable to meet demand. This price increase has been reinforced by the effect of the pandemic and, more recently, by that of the war, with dramatic effects on energy and raw material costs. On this point, the market will be in charge of redressing the balance. As for the shortage of plots of land for houses or collective housing buildings, no legislative change is foreseen in the near future to allow for new developable spaces.
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