There are risks in home prices in Portugal but measures are “sufficient”
The European Systemic Risk Committee (ESRB) considers that in Portugal there are risks related to the overvaluation of housing prices and the increase in household debt, noting that measures to avoid problems are “sufficient”.
In a report published today, released through a statement from the Bank of Portugal (BdP), the CERS reported on the “results of the assessment of the transversal risks and term vulnerabilities of the specific real estate markets of the Member States of the European Union (EU), Iceland , Liechtenstein and Norway, carried out during the year 2021”.
About Portugalone entity pointed out that the prices of houses “at this moment estimated” and that asked for valued”.
While part of this dynamic can be attributed to the existence of a prior undervaluation, as the BdP estimates propose” that there was an assessment of the European Central Bank (ECB) already the model for a fall over the assessment end of 2020 and beginning of 2021.
The ESRB warns, however, that both as estimates to a segment related to tourism factors do not have high uncertainty as residents.
“In 2020 and in the first half of 2021, growth in house prices continued despite the pandemic”, says the entity, indicating that the average price growth was 8.6% in 2020, compared to 9.3% in 2019 and further highlighting that the number of transactions was already at pre-pandemic levels at the end of 2020.
According to the ESRB, as 222) reduced the financial measures with financial resources reduced to the value of customers and the amounts of new financing 1 customers and the amounts of new financing.
Even so, the CERS warned, that is, the CERS of Portuguese families, which was falling until recently, but which has risen again, namely housing finance, which represents a relevant percentage, are variables a “source of risk”.
According to the international banks committee with 38% of the total quarter of the first quarter of last year.
In the evaluation, the CERS were considered current policies in this area in Portugal are “appropriate and sufficient”.
In the statement BdPou recalled that “in 2019, its ESRB addressed five countries (Germany, France, Norway and the Czech Republic) the alert is to six (Belgium, Denmark, Finland, Luxembourg, the Netherlands and Sweden) “As well as the concrete measures of the ESRB, are being designed as specific policies that are specific to the ESRB, are being designed without risks to macroprudential policy and other known policies”.
“they were addressed to the authorities of the authorities who, in 201 countries, received alerts regarding these countries, already of systemic risk in the real estate market or already received of systemic risk in the residential real estate market and in which the respective intensity remained and worsened”.
In today, the evaluation committee considered that “associated with the real estate market (high risk residential brand, countries of Norway, the Netherlands and Sweden), medium and in the other countries a high risk assessment level in five countries like the other countries”.
Thus, as a result of this assessment, “alerts were sent to five countries (Bulgaria, Croatia, Hungary, Liechtenstein and Slovakia) and addressed to two countries (Germany and Austria)”.
“In Portugal, the risk was assessed as medium level and the macroprudential policy by the Bank of Portugal was considered adequate and sufficient for the risks protected”, reinforced the entity.
WITH LUSA