Lisbon's hot real estate market leaves buyers struggling for a home

Lisbon

IN central Lisbon's property market, sellers are kings.

The Portuguese capital's real estate boom is entering a new phase as a shortage of prime property in the city centre is prompting some buyers to bid above the asking price for the last available units.

"There's a big gap between supply and demand," said Luis Tilli, a real estate agent at Lisbon-based HomeLovers, which is selling a three-bedroom, 236 sq-metre refurbished duplex in the historic quarter of Chiado for two million euros (S$3.2 million). "It's reached a point where some investors offer to pay above the asking price just so they can close a deal."

Lisbon's property market revival began after the previous government eased long-held rent controls and started offering residence permits in 2012 to non-European property buyers, mostly from China. Portugal's tax-friendly regime for foreign residents and a tourism boom that led to the conversion of hundreds of buildings into short-term rental apartments and hotels have also helped fuel demand. With the housing stock available along Lisbon's river Tagus tumbling, inv…