Lisbon vs Porto: The Rental Market Disparities Unveiled
Diário Imobiliário3 weeks ago
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Lisbon vs Porto: The Rental Market Disparities Unveiled

Economy
rental
lisbon
porto
housing
economy
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Summary:

  • 400 euros difference in rent costs and tenant expectations in Lisbon and Porto

  • Lisbon's average rent decreased by 10% to 1,792 euros

  • Tenant spending intentions in Lisbon increased by 16.7%

  • Porto's rental prices rose by 11.1%, average rent now at 1,500 euros

  • European rental prices increased by 4.1%, tenant expectations rose by 19.1%

Rental Market Overview

In both Lisbon and Porto, there exists a notable difference of approximately 400 euros between rent costs and tenant expectations. Despite this similarity in figures, the cities are trending in different directions, as highlighted by the HousingAnywhere Rent Gap Monitor.

Lisbon's Rental Dynamics

According to the report from the European medium-term rental platform, Lisbon is witnessing a convergence between tenant expectations and market prices compared to last year. This shift is attributed to the city's gradual recovery from significant price hikes observed previously.

In the third quarter of 2024, the average cost of renting a furnished apartment in Lisbon was 1,792 euros, reflecting a 10% decrease from the previous year. Concurrently, there was a 16.7% increase in tenants' spending intentions, with an average willingness to pay of 1,400 euros. As a result, the gap between market value and tenant expectations has significantly narrowed from 800 euros last year to 392 euros now, indicating that tenants are becoming more aligned with market trends.

Porto's Rental Challenges

In contrast, in Porto, the difference between rental prices and tenant expectations stands at 401 euros, mirroring Lisbon's situation. However, the dynamics are markedly different. Rental prices continue to increase, with an 11.1% rise, making the average cost of a furnished apartment 1,500 euros. While tenants are also willing to pay more, with a 5.7% increase in their expectations, it has not been sufficient to keep pace with the rising rents. Tenants anticipated finding apartments for around 1,099 euros on HousingAnywhere, leading to a nearly 30% increase in the gap compared to the 310 euros recorded last year.

European Rental Trends

Across Europe, rental prices have risen by an average of 4.1% compared to the previous year. Tenants have adjusted their spending expectations, increasing them by 19.1%. This adjustment has resulted in a reduction of the gap between actual prices and tenant expectations, dropping from 413 euros last year to 305 euros now.

The analysis also reveals significant disparities among cities. For instance, in Rome, the gap is even larger, with a 1,000 euro difference, as the average rent is 2,500 euros, while tenants expect to spend only 1,500 euros. Conversely, cities like Vienna and Barcelona show much smaller discrepancies, with prices only 100 euros above expectations.

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