Savills Portugal

High Funding Costs and Conservative Lending Drive Discounted Property Sales

Sustained high cost of funds leads to more property investors putting assets up for sale at discounted prices.

Banks' reluctance to lend to the commercial real estate market restricts investment demand.
Cash-rich buyers and end-users dominating the market.
Significant decline in major property transactions in the first half of 2024, representing a 47% decrease compared to the first half of 2023.
Savills forecasts 5-10% decrease in Grade A office and prime street shop prices in the rest of 2024.

Sustained high cost of fund has led to more property investors put their assets up for sales at discounted prices, but bank’s reluctance to lend into the commercial real estate market restricts investment demand, with cash rich buyers and end users dominating the market.
Jack Tong, Savills Research & Consultancy