The European Commission is attentive to the housing crisis in Portugal, especially in Lisbon

The European Commission guarantees careful attention to the housing crisis in Portugal, especially in Lisbon, but emphasizes measures to mitigate the impact of interest rates on loans, which it believes will not be affected by the political crisis.

“I am fully aware of the importance of the topic [crise da habitação] in Portugal and in Lisbon in particular, and I think that the government’s initiatives are justified for this reason,” said the European Commissioner for Economic Affairs.

In an interview with the Lusa agency in Brussels, on the day that the community leader published autumn economic forecasts that indicate that house prices in Portugal have more than doubled over the past decade and are continuing to rise, Paolo Gentiloni noted that “of course, This is one of the components that is very important to observe.”

“We know that governments are taking initiatives, especially with variable mortgages. [no crédito à habitação] to cover housing costs, [mas] trend [de subida de preços] in some countries it still persists,” he added.

We are talking about measures taken by the executive branch in relation to housing lending to mitigate the impact of rising interest rates on family accounts.

When asked whether the ongoing political crisis in the country could affect these initiatives to support families, Paolo Gentiloni replied that “we should not expect this.”

“Of course, political crises in general affect the processes, but, as far as I understand, the President of Portugal [Marcelo Rebelo de Sousa] It was also decided to call elections taking into account the need to approve the state budget for 2024, the Italian official concluded.

House prices have more than doubled since 2010 in Portugal and eight other European Union (EU) member states and are set to continue rising across Portugal despite a “cooling spell” in the European property sector, the European Commission said today.

In the housing crisis chapter of its autumn economic forecast published today, Brussels notes that “European property markets have cooled since mid-2022, along with a significant slowdown in lending levels,” given the tight monetary policy of the European Central Bank (ECB).

However, despite the fact that house prices in a number of EU member states have already peaked, already in the second quarter of 2022, “steady price increases continue in Bulgaria, Croatia, Greece, Portugal and Slovenia,” Brussels says .

The community leader concludes that at EU level, “future household credit constraints suggest house prices will remain under pressure in the coming quarters before growth returns.”

To reach the 2% inflation target set for price stability, the ECB has successively raised interest rates, which have since stabilized at high levels.

This situation mainly affects countries with a significant percentage of variable rate mortgages, such as Portugal.

However, in its economic forecasts, the European Commission states that “the increase in interest costs was small in Poland and Portugal, despite the predominance of variable rate mortgages, due to government measures to reduce interest rates, which limited the increase in interest costs” .