Home prices in Portugal, one of Europe’s hottest property markets, are expected to continue rising in 2025 on the back of increasing foreign demand and lackluster supply, according to DBRS Morningstar.

“Factors such as supply-demand dynamics, lack of new construction, and increased foreign interest shall persist in the short to medium term and keep an upward pressure on prices,” said a report by senior credit analyst Andre Soutinho and other DBRS researchers.

Portugal became a hot spot for foreign buyers more than a decade ago after the nation introduced “golden visas” which tied residency permits to investment in the country, including real estate purchases. The real estate option was removed in 2023 as a means of accessing golden visas, but that hasn’t deterred overseas buyers. 

Wealthy Americans have flocked to Portugal in recent years in search of sunny climes and a lower cost of living. These buyers accounted for about a third of all sales of Knight Frank’s Portuguese unit since the start of the year, according to Chief Operating Officer Jorge Costa. 

While the red-hot market has been a boon for existing homeowners, it’s also created a challenge for locals and first-time home buyers in Portugal, said DBRS. Prime residential property prices in Lisbon, the Portuguese capital, are now higher than in Madrid, Berlin and Amsterdam, according to a Savills Plc. report from February that tracks prime residential property in international cities.

To address the lack of affordable housing, Portugal’s outgoing government vowed to add 59,000 new homes. It also recently announced that the state would guarantee home purchase loans for borrowers between 18 and 35.

Developers in Portugal have said that it will take time to close the gap between supply and demand and that rising construction costs will make it hard to bring down property prices.

“Governmental measures to address these imbalances in our view are relatively limited as they require time to have an effect,” the credit rating agency DBRS said.

Social housing accounts for just 2% of the total housing stock in Portugal — among the lowest levels in the EU.

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A growing share of US consumers say they’re not seeking loans because they expect to be refused amid tight credit conditions, according to data from the Federal Reserve Bank of New York. 

The share of discouraged borrowers, defined as respondents who said they needed credit but didn’t apply because they didn’t expect to get approved, climbed to 8.5% in the New York Fed’s latest Survey of Consumer Expectations. That’s the highest level since the study began in 2013.

The perceived likelihood of being rejected increased across different forms of credit, from cards to secured loans to buy homes and cars. Roughly one-third of auto loan applicants expected to get turned down, the highest share since the start of the series, while nearly half of all respondents in the February survey said it’ll be harder to get credit in a year’s time.

The data adds to a picture of increasingly fragile household finances for many Americans, as a cooling job market slows wage gains while high borrowing costs are making bills harder to pay. Delinquency rates remain low by pre-pandemic standards but they’ve been edging higher in most categories, and lenders are turning cautious.  

More than four in 10 US homeowners who sought to refinance their mortgages had their applications rejected, according to the February survey, quadruple the share in October 2023. 

With mortgage lending rates still much higher than a couple of years ago, many people seeking a refi are likely trying to tap equity accumulated during the recent housing boom in order to meet other debt costs or expenses, rather than to reduce their monthly payments. Inability to do so could put some under pressure to sell their homes. 

Meanwhile, the share of consumers in the New York Fed survey who said they could come up with $2,000 in the event of an unexpected need declined to 63%, a new series low.

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The head of Canadian jet manufacturer Bombardier Inc. raised concerns about Canada’s decision to review a contract to buy dozens of F-35 fighter jets from Lockheed Martin Corp., the country’s latest response to the trade war with the US.

“Canceling the F-35s might be a good idea, but we need to think about it,” Bombardier Chief Executive Officer Eric Martel told a business audience in Montreal. “We have contracts with the Pentagon. Will there be reciprocity there?” 

Bombardier has invested in recent years in its defense unit, which converts jets into military aircraft. It has two contracts with the US government, one for communication aircraft and another for surveillance planes.

New Canadian Prime Minister Mark Carney ordered a review of the F-35 purchase agreement, a C$19 billion ($13.3 billion) deal for 88 jets that was finalized in 2023. The deal hasn’t been scrapped, but the government needs to “make sure that the contract in its current form is in the best interests of Canadians and the Canadian Armed Forces,” a defense ministry spokesperson said. 

Earlier this month, President Donald Trump put 25% tariffs on imports on Canadian goods that don’t fall under the US–Mexico–Canada Agreement, and added 25% import taxes to aluminum and steel products. He has repeatedly said he believes Canada should be the 51st US state — a recent poll showed that 90% of Canadians disagree — and members of his administration have taken the Canadian government to task for its low level of military spending. 

“Trump isn’t wrong on everything,” Martel said. “We’ve been hiding behind our big brother for a while, and we’re completely dependent on him militarily.”

In 2023, Canada finalized a deal to order as many as 16 military surveillance aircraft from Boeing Co. as part of an investment worth more than $7 billion, rejecting a competing Bombardier proposal.

The jet maker’s shares have dropped 18% since Trump was elected on Nov. 5, but are still up about 50% over the past year. 

In February, Bombardier set aside its financial outlook for the year because of risk and uncertainty about tariffs. “Not providing guidance is the most responsible thing for us to do,” Martel said at the time. About 60% of Bombardier’s business comes from the US, and its planes are currently built and shipped under the rules of the US-Mexico-Canada Agreement. 

Bombardier has a complicated supply chain that includes manufacturing in US and Mexico with more than 2,800 US-based suppliers across 47 states. US-made parts and systems make up a significant proportion of the cost of its aircraft. 

The Global 7500, the firm’s flagship jet, has wings made in Texas, avionics from Iowa and motors made in Indiana. More than half of its building costs are tied to US manufacturing, but the assembly and finishing are done in Canada, which makes the jet subject to tariffs.

Two-thirds of Canada’s aerospace industry exports depend on the US market, Martel said.

This story was originally featured on Fortune.com