Bank Valuations Show 19.1% Increase In Housing Values

Bank Valuations: Housing Values Up 19.1% Within A Year

There are new numbers for the median bank valuation of housing. In February, the average value for homes in Madeira stayed the same as the previous month, at €1,787 per square meter. But compared to February last year, it went up by 19.1%, which means an increase of €287.

Apartments More Worth Than Houses

For apartments, the average value was €1,863 per square meter, showing a slight increase of 0.4% compared to January 2024 and a significant rise of 19.6% compared to the same time last year. Meanwhile, for houses, the average valaue was €1,623 per square meter, slightly lower than the previous month but still 15.1% higher than last year.

Funchal 16% More Expensive on Average

In Funchal, the average value was €2,076 per square meter, up by 1.1% from the previous month and 19.1% higher than in February 2023. Compared to the island-wide average of €1,787 this makes Funchal 16.17% more expensive. Câmara de Lobos (€1,604) and Santa Cruz (€1,652) were also considered in the statistics. Both Câmara de Lobos and Santa Cruz saw a 1.6% increase compared to the previous month. And compared to last year, they experienced increases of 5.4% and 16.8%, respectively.

Madeira The Third Most Valued Region

Across Portugal, the average value was €1,560 per square meter in February, up by €10 from the previous month (0.6% increase). Compared to 2023, it was 5.5% higher (median). Madeira ranks as the third most valued region in Portugal, right after Greater Lisbon and Algarve. Madeira's values went up by 19.1% compared to 12 months ago, the highest increase among all regions.

Banks Are Processing More Valuations

The number of valuations done by banks in Madeira also increased. In February 2024, there were 568 evaluations, up by 29.4% from the same time last year. Out of these, 313 were for apartments and 255 for houses. Compared to the previous month, there were 7 more valuations, marking a 1.2% increase.

When Does A Bank Conduct Property Valuations?

Banks typically conduct valuations of housing properties when a person applies for a mortgage to purchase a property, the bank assesses the value of the property to determine how much they are willing to lend. There can be other reasons whereas the source did not determine if they apply. Other reasons can be

Refinancing: If a homeowner wants to refinance their mortgage, the bank may conduct a new valuation of the property to determine the loan amount and terms.

Home Equity Loans or Lines of Credit: For homeowners seeking to borrow against the equity in their homes, banks may conduct valuations to determine the amount they are willing to lend.

Foreclosure or Repossession: In cases where a borrower does not meet his mortgage, leading to foreclosure or repossession, the bank may value the property to determine its worth before selling it to recover the outstanding debt.

Portfolio Management: Banks with real estate holdings may periodically value their properties for financial reporting and portfolio management purposes.

Source: Regional Directorate of Statistics of Madeira (DREM)