The average value of a home in Portugal increased to €1,106sqm (£971sqm) in January, according to the National Statistics Institute (INE).

Based on the latest bank valuations, the month-on-month rise is the equivalent of 0.5%, which is actually lower than the 0.8% recorded the previous month.

On an annual basis, the variation in average bank valuations, providing residential property loans, increased from 4.8% in December to 5.6% in January.

Home price gains were led by the Lisbon Metropolitan Area, where values increased by an average of 0.8% month-on-month to hit an average of €1,341sqm (£1,171sqm).

The north of Portugal saw an annual price rise of 6.2% in January, up from 5.2% the previous month.

The islands of Madeira and the Azores were the only Portuguese regions to record a decline in average property valuations compared with 12 months earlier.

Residential property price growth in Portugal is being supported in part by the recovery in the country’s mortgage market, with borrowing rates currently at an historic low. The average average new mortgage secured in January was €87,578 (£76,872), up from €86,462 (£75,892) a month earlier.