REAL ESTATE MARKET: NOTARIAL SALES AND MORTGAGES - FIRST QUARTER 2023

In the first quarter of 2023, there were 210,691 notarial agreements for the sale and other agreements relating to transfer deeds for consideration for real estate units (-5.0% compared to the previous quarter and -11.0% year-on-year).

In the short-term comparison, housing shows negative percentage changes in all geographical areas of the country (North-West -11.3%. South -4.7%, Centre -4.3%, Islands -2.2%), with the exception of the North-East which, on the contrary, grew (+1.0%). The economic sector increased in the North-East and Centre (+13.0% and +6.9% respectively), while it remained substantially stable in the Islands (-0.1%), in the North-West (+0.4%) and in the South (+0.5%).

93.9% of the agreements signed concern the transfer of ownership of residential properties (197,547), 5.9% those for economic use (12,474) and 0.3% special use and timeshare agreements (670).

Compared to the first quarter of 2022, real estate transactions decreased by 11.6% in the housing sector and increased by 1.6% in the economic sector.

At the territorial level, the housing sector marks, on an annual basis, negative percentage changes throughout the country: North-West -16.5%, Centre -16.0%, North-East -7.8%, Islands -4.9% and South -4.6%. The economic sector grew in the South (+5.5%), in the North-East (+2.8%), in the Islands (+1.0%) and in the North-West (+0.7%), while it decreased in the Centre (-1.8%). In the housing sector, sales decreased in both large and small towns (-18.3% and -6.4% respectively); in the economic one, on the contrary, they increased (respectively +1.5% and +1.6%).

Notarial agreements for mortgages, loans and other obligations with the establishment of a real estate mortgage were 73,582 (-12.6% compared to the previous quarter and -31.0% year-on-year). The decline affects the entire territory on a quarterly basis (North-West -20.5%, Centre -12.6%, South -8.0%, North-East -5.9% and South -5.0%), and annual (North-West -36.5%, Centre -33.9%, South -25.6%, North-East -25.5%, Islands -25.3%, Metropolitan Cities -36.4% and small towns -26.6%).

Commentary

In the first quarter of 2023, the real estate market continued and accentuated the downward trend already observed, both year-on-year and quarter-on-quarter, in the third and fourth quarters of 2022. After eight consecutive quarters of growth, recorded between the third quarter of 2020 and the second quarter of 2022, the last three show a contraction that is mainly driven by housing, the driving sector of the entire real estate market.

Mortgages, loans and other bonds with real estate mortgages anticipate by one quarter the downward trend that, both year-on-year and quarter-on-quarter, has been observed since the second quarter of 2022. The decline became more intense in the third and fourth quarters of 2022, reaching the most marked negative changes in the first quarter of 2023, after those already highlighted in the second quarter of 2020. This dynamic is evident both in comparison with the previous quarter and in comparison with the same quarter of 2022.

FDT CONSULTING