{"status":"ok","message-type":"work","message-version":"1.0.0","message":{"institution":[{"name":"Qeios"}],"indexed":{"date-parts":[[2026,2,28]],"date-time":"2026-02-28T02:02:40Z","timestamp":1772244160199,"version":"3.50.1"},"posted":{"date-parts":[[2025,7,23]]},"reference-count":16,"publisher":"Qeios Ltd","license":[{"start":{"date-parts":[[2025,7,23]],"date-time":"2025-07-23T00:00:00Z","timestamp":1753228800000},"content-version":"unspecified","delay-in-days":0,"URL":"http:\/\/creativecommons.org\/licenses\/by\/4.0\/"}],"content-domain":{"domain":[],"crossmark-restriction":false},"short-container-title":[],"abstract":"<jats:p>This paper investigates whether housing price bubbles emerged in Portugal\u2019s two major metropolitan areas \u2014 Lisbon and Porto \u2014 and whether price pressures in central municipalities have spilled over into neighboring municipalities.\n\nWe employ a quantitative approach based on the present value model, testing three hypotheses regarding affordability, speculative behavior, and spatial contagion. Affordability was analyzed using the housing affordability index (price-to-income ratio). Housing bubbles were identified if rental yields fell below mortgage interest rates (measured with T-tests). The spillover effects were identified using the Granger causality test.\n\nThe results show a substantial decline in affordability in both metropolitan areas. Lisbon reached an affordability index of 24.5 years of net income to purchase a standard dwelling (up from 13.8 in 2017). Porto also sees a significant rise to 19.1 years. While no widespread housing bubble was detected, localized speculative signs appeared in Lisbon and Oeiras, where housing yields temporarily fell below mortgage rates. Both metropolitan areas have widespread spillover effects, especially in Porto's neighboring municipalities, showing that the affordability constraints depart from the central municipality but affect neighboring municipalities.\n\nPolicymakers can benefit from these conclusions to address the housing affordability problem with metropolitan-level policies instead of national-level or municipal-level policies, as they are being addressed today.<\/jats:p>","DOI":"10.32388\/mrk5bu","type":"posted-content","created":{"date-parts":[[2025,7,23]],"date-time":"2025-07-23T23:54:54Z","timestamp":1753314894000},"source":"Crossref","is-referenced-by-count":0,"title":["Are We in a Housing Bubble? Empirical Evidence From Portugal"],"prefix":"10.32388","author":[{"ORCID":"https:\/\/orcid.org\/0000-0002-9116-7222","authenticated-orcid":true,"given":"Antonio M.","family":"Cunha","sequence":"first","affiliation":[]}],"member":"17262","reference":[{"key":"ref1","doi-asserted-by":"crossref","unstructured":"\u00c9gert B, Mihaljek D (2007). \"Determinants of House Prices in Central and Eastern Europe.\" Comp Econ Stud. 49(3):367\u2013388. doi:10.1057\/palgrave.ces.8100221.","DOI":"10.1057\/palgrave.ces.8100221"},{"key":"ref2","doi-asserted-by":"crossref","unstructured":"Duca JV, Muellbauer J, Murphy A (2021). \"What Drives House Price Cycles? 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A Meta-Analysis.\" IMF Econ Rev. 71(2):538\u2013573. doi:10.1057\/s41308-022-00185-5.","DOI":"10.1057\/s41308-022-00185-5"},{"key":"ref11","doi-asserted-by":"crossref","unstructured":"Mayer C (2011). \"Housing Bubbles: A Survey.\" Annu Rev Econ. 3(1):559\u2013577. doi:10.1146\/annurev.economics.012809.103822.","DOI":"10.1146\/annurev.economics.012809.103822"},{"key":"ref12","doi-asserted-by":"crossref","unstructured":"Alessi L, Detken C (2011). \"Quasi Real Time Early Warning Indicators for Costly Asset Price Boom\/Bust Cycles: A Role for Global Liquidity.\" Eur J Polit Econ. 27(3):520\u2013533. doi:10.1016\/j.ejpoleco.2011.01.003.","DOI":"10.1016\/j.ejpoleco.2011.01.003"},{"key":"ref13","unstructured":"Fanico MDCL (2009). Mercado imobili\u00e1rio portugu\u00eas: performance, ciclos e tend\u00eancias [Portuguese Real Estate Market: Performance, Cycles and Trends]. ISCTE - Instituto Universit\u00e1rio de Lisboa (Portugal)."},{"key":"ref14","doi-asserted-by":"crossref","unstructured":"Janu\u00e1rio JF, Costa \u00c1, Cruz CO, Sarmento JM, e Sousa VF (2021). \"Transport Infrastructure, Accessibility, and Spillover Effects: An Empirical Analysis of the Portuguese Real Estate Market from 2000 to 2018.\" Res Transp Econ. 90:101130. doi:10.1016\/j.retrec.2021.101130.","DOI":"10.1016\/j.retrec.2021.101130"},{"key":"ref15","doi-asserted-by":"crossref","unstructured":"Duca JV (2020). \"Making Sense of Increased Synchronization in Global House Prices.\" J Eur Real Estate Res. 13(1):5\u201316. doi:10.1108\/JERER-11-2019-0044.","DOI":"10.1108\/JERER-11-2019-0044"},{"key":"ref16","doi-asserted-by":"crossref","unstructured":"Ooi JT, Le TT (2013). \"The Spillover Effects of Infill Developments on Local Housing Prices.\" Reg Sci Urban Econ. 43(6):850\u2013861. doi:10.1016\/j.regsciurbeco.2013.08.002.","DOI":"10.1016\/j.regsciurbeco.2013.08.002"}],"container-title":[],"original-title":[],"link":[{"URL":"https:\/\/www.qeios.com\/read\/MRK5BU\/pdf","content-type":"application\/pdf","content-version":"vor","intended-application":"unspecified"},{"URL":"https:\/\/www.qeios.com\/read\/MRK5BU\/pdf","content-type":"unspecified","content-version":"vor","intended-application":"similarity-checking"}],"deposited":{"date-parts":[[2025,7,23]],"date-time":"2025-07-23T23:54:57Z","timestamp":1753314897000},"score":1,"resource":{"primary":{"URL":"https:\/\/www.qeios.com\/read\/MRK5BU"}},"subtitle":[],"short-title":[],"issued":{"date-parts":[[2025,7,23]]},"references-count":16,"URL":"https:\/\/doi.org\/10.32388\/mrk5bu","relation":{"has-review":[{"id-type":"doi","id":"10.32388\/J0UYKU","asserted-by":"object"},{"id-type":"doi","id":"10.32388\/13YBO0","asserted-by":"object"},{"id-type":"doi","id":"10.32388\/QRSUSV","asserted-by":"object"},{"id-type":"doi","id":"10.32388\/U7CQBP","asserted-by":"object"}]},"subject":[],"published":{"date-parts":[[2025,7,23]]},"subtype":"preprint"}}