According to a study by the OECD, while property prices have skyrocketed, average household incomes have not. Now a Portuguese person needs the equivalent of 11.4 years of salary to be able to buy a 100 square metre house.
Analysing the 31 main OECD economies, it was found that in 2020, in Portugal, a household needed the equivalent of 11.4 years of wages to buy a house of 100 square meters, practically the same as was needed in 2000 (11.3 years).
Portugal appears above the middle of the table, ahead of countries such as the United States (where families need the equivalent of 4.1 years of wages), Norway (7.8 years), the United Kingdom (11 years) or Sweden (11.2 years). Behind Portugal, are countries such as Switzerland (12.6 years), France (12.8 years), Luxembourg (15.8 years) or New Zealand (18.7 years).
“The decline in housing affordability has led to economic and social challenges that disproportionately affect the poorest households and young people,” says the OECD. House prices and rents “have risen faster than inflation and incomes in recent decades, and while lower interest rates have reduced mortgage costs, they have only partially cushioned the impact of higher house prices.”