Source: Adobe Stock Author: Redaction House prices in Lisbon nearly stable House prices in Lisbon recorded a slight decrease of 0.1% in February 2026, settling at 6,059 euros per square metre. Despite this monthly drop, the property market remains at high levels , very close to the record peak reached in January. Recent trends show that house prices in Lisbon continue to reflect strong demand, with a 2.5% increase in the last quarter and an annual growth of 9.9%. Lisbon remains above the national average Compared to the rest of the country, house prices in Lisbon remain significantly higher. In February, the national average stood at 3,076 euros per square metre, highlighting a clear gap compared to the capital. While the national market recorded annual growth of 12.2%, Lisbon continues to be one of the most expensive places to buy property, increasing pressure on buyers and investors. Marked differences between areas House prices in Lisbon vary considerably depending on location. The most expensive areas continue to be concentrated in the city centre and premium locations, with parishes such as Santo António, Avenidas Novas and Estrela showing high values per square metre. On the other hand, areas like Santa Clara, Olivais and Beato stand out as more affordable options, although they are also seeing significant increases, reflecting growing demand outside the city centre. Sharp increases and signs of adjustment Despite the apparent monthly stabilisation, there are areas where house prices in Lisbon continue to rise sharply. The parish of Penha de França stands out with a 20.7% annual increase, leading price growth in the city. Areas such as Olivais and Benfica also show strong momentum. In contrast, some areas are beginning to show signs of correction, indicating possible market adjustments. Nevertheless, the overall trend still points to sustained high prices in the capital.
Source: Adobe Stock Author: Redaction Drop in the number of purchases by foreigners The housing market in Portugal recorded in 2025 a significant reduction in purchases made by foreigners. A total of 8,471 homes were acquired by people with tax residence outside the country, a decrease of 13.3% compared with 2024 and 20.6% below the numbers recorded in 2022. Among foreign buyers, 4,416 reside in the European Union and 4,055 in other countries, both with significant declines. This trend shows that housing prices in the country are becoming increasingly less attractive to foreign investors. At the same time, the majority of transactions in 2025 were carried out by residents in Portugal, who purchased more than 161,000 homes, corresponding to 95% of the total. Investment and geographical distribution In terms of values, foreigners spent €3.4 billion on housing, representing 8.2% of the total invested in the country. EU residents bought homes worth €1.5 billion, while those living outside the EU invested €1.9 billion. The Algarve continues to be the favourite region for foreigners, with nearly 30% of transactions and 42.4% of the total amount. The North and Centre follow in terms of number of operations, while Greater Lisbon holds the second position in total value invested. This distribution shows that foreigners favour strategic coastal and urban areas, even with the reduction in overall interest. Main nationalities and average values Among foreign buyers, Brazil leads in number of transactions, followed by Angola and France. However, the countries with the highest average transaction value include the United Kingdom, the USA, and China. The INE also highlights that countries such as Ukraine, Cape Verde, and Venezuela recorded increases of more than 25% in number of acquisitions. The data show that, although the volume of foreigners buying homes in Portugal has been falling for the third consecutive year, there are significant variations between regions, nationalities, and average values, reflecting different investment profiles in the Portuguese real estate market.
Source: Adobe Stock Author: Redaction Real estate maintains growth in Portugal The real estate sector in Portugal once again showed clear signs of dynamism throughout 2025. Despite a context marked by high housing prices, demand remained consistent and contributed to an increase in both the number of transactions and the overall volume of business in the national real estate market. This performance reinforces the perception that real estate continues to be one of the pillars of economic activity related to housing. The evolution of real estate was supported by several factors. Among them were incentives for home purchases, particularly aimed at younger buyers, as well as a drop in mortgage interest rates during part of the year. These elements enabled many families to move forward with purchasing decisions in real estate, even amid a scenario of elevated residential market values. Another important factor was the continued interest of international buyers. Although the real estate market is dominated by domestic clients, the presence of foreign investors continues to play a relevant role in certain segments and regions. This diversity of demand helped keep the real estate market active throughout 2025. Strong demand in real estate Recent data reveal that real estate saw growth both in the number of transactions and in the total value of deals carried out. The volume of investment associated with real estate increased compared to the previous year, reflecting consistent activity from buyers and investors. At the same time, the average price of properties sold also continued to rise. This trend confirms that demand continues to exceed available supply in many parts of the country. In several cities and metropolitan areas, real estate shows average sale values higher than those recorded in previous years. Despite this appreciation, real estate continues to attract families seeking their own homes. For many buyers, purchasing a house remains a priority and a form of long-term investment. The market also benefits from the perceived stability associated with investing in residential assets. Supply shortages still affect real estate One of the main challenges identified in real estate remains the shortage of housing supply. In several regions, the number of homes available for sale or rent remains insufficient to meet existing demand. This situation limits the growth potential of real estate and contributes to maintaining high prices. The lack of new construction has been pointed out as one of the causes of this situation in real estate. Housing production has not kept pace with demand, creating a structural imbalance in the market. As a result, real estate faces difficulties in providing affordable solutions for different buyer profiles. Nevertheless, the real estate sector continues to show resilience. The entry of new professionals, the expansion of brokerage networks, and investment in technology demonstrate that real estate remains a competitive and evolving market. Outlook for real estate in 2026 For the coming years, expectations point to a possible stabilisation of real estate in Portugal. Although rapid increases like those seen in recent periods are not anticipated, there are also no clear signs of deep market corrections. The evolution of real estate will depend on several factors, including the ability to increase housing supply, the development of interest rates, and household purchasing power. If these conditions remain balanced, real estate could continue to grow sustainably. In the current context, real estate remains a strategic sector for the Portuguese economy. Demand for housing, combined with the interest of investors and buyers, indicates that real estate will continue to play a central role in the country’s housing market.
Source: Adobe Stock Author: Redaction Young people continue to want to buy a home Over the past two decades, young people’s participation in the housing market has changed significantly. The proportion of owners aged 25 to 34 has dropped sharply since the early 2000s. Currently, many young people leave their parents’ home later, also delaying the decision to buy a home. Despite this trend, the most recent mortgage data reveals an interesting scenario. In 2024, almost half of new financing contracts were signed by people up to 35 years old. This shows that even if the decision is made later, the goal of buying a home remains present for many young people. This renewed interest is also linked to support measures for financing, which have facilitated access to credit for first-time homebuyers. As a result, many young people are considering buying again as a realistic alternative to renting. Renting or buying: cost comparison To better understand this dilemma, it is useful to analyse a concrete example. Considering a property of around 80 square metres in Braga, the average rent is about €10.3 per square metre. This translates into a monthly rent close to €824. At the national level, the average rent is higher, around €16.1 per square metre. Even so, rents in Braga represent a significant financial effort for those starting independent living. When analysing the option of buying a home, the numbers present a different perspective. The average sale price in Braga is around €1,896 per square metre, putting an 80-square-metre property at approximately €151,680. Although these values remain high, they are below the national average, which exceeds €2,000 per square metre. Initial capital required to buy a home The main difference between renting and buying arises when examining the initial capital required. For renting, landlords commonly request two months’ deposit plus two months’ rent in advance. In an example with €824 rent, the initial outlay can exceed €3,200. On the other hand, when buying a home with financing covering the full property value, an initial down payment may not be necessary. Thus, the main costs are the stamp duty on the mortgage, bank fees, and notary charges. In total, these costs can be around €2,500, depending on the financial institution. In this scenario, the amount required to buy a home may even be lower than that needed to start a rental contract. Buying a home as a long-term strategy Although finding properties within these values is not always easy, the example shows an important shift in how many young people view the market. For years, buying a home was seen as a distant goal for those beginning their professional life. Today, under certain circumstances, buying a home can be a financially competitive alternative to renting. While paying rent corresponds to a monthly expense without building equity, buying a home allows for the gradual creation of an asset over time. Moreover, even if the first property is not the ideal home, it can represent an important first step towards financial stability. Many buyers view purchasing a home as a gradual investment in their own housing. With some support measures currently in place and financing conditions favourable for certain profiles, the timing to buy a home has become particularly relevant for young people. In some cases, the difference between renting and buying is no longer just the monthly cost, but a long-term financial strategy.
Source: Adobe Stock Author: Redaction What it is and why it matters when buying a home When buying a home, the energy certificate is a central element in the decision. This document assesses the property’s energy performance and estimates heating, cooling and hot water needs. In a context of high energy prices, the energy rating can mean significant differences in annual expenses. Before buying a home and signing a CPCV, it is important to analyse the rating shown in the listing. The classification results from assessing the building envelope, windows, climate control systems and any use of renewable energy. It is not an aesthetic detail, but a technical indicator that affects comfort and future costs. How the energy rating is determined The scale ranges from A+ to F. When buying a home, an A or A+ rating tends to indicate better insulation and lower consumption. Intermediate ratings such as B or C show acceptable performance, while D, E or F may point to the need for investment in improvements. The assigned rating does not depend on a fixed universal value. The property is compared with a reference building, taking into account the climate zone and construction characteristics. For those looking to buy a home, this means that two similar properties may have different ratings depending on the technical solutions adopted. Legal obligations and associated costs The certificate is mandatory for sale. The rating must appear in the advertisement and the certificate number must be included in the deed. When buying a home, always check that the certificate is valid and registered. Its absence may delay the process and lead to fines for the seller. The cost is divided between a registration fee and the expert’s fees. As a rule, the owner bears this expense. Even so, when buying a home, you should bear in mind that the asking price may already reflect investments made to improve the energy rating. Impact on value and mortgage When buying a home, the energy rating influences the perception of value. An efficient property tends to justify a higher price due to expected energy savings. Conversely, a low rating may support negotiation, considering the works required. In mortgage lending, there is no legal obligation to offer better terms because of the rating. However, when buying a home, it is worth asking the bank about possible solutions linked to energy efficiency or financing for improvements. Tax benefits and possible support Some municipalities may provide IMI reductions for more efficient properties. When buying a home, check with the local authority whether any benefit applies. There is no automatic IMT reduction solely for a better energy rating. In public efficiency support programmes, the certificate is often required before and after the works. For those considering buying a home with the intention of renovating, this aspect can be decisive in financial planning. What to review before closing the deal Before buying a home, check the certificate’s validity, analyse the technical recommendations and estimate the costs of any improvements. The decision should not be based solely on the monthly mortgage payment. Buying a home involves assessing thermal comfort, energy expenses and potential appreciation. The energy certificate is a practical tool to reduce uncertainty and support an informed and financially sustainable decision.
Source: Adobe Stock Author: Redaction Buying a House in Portugal: Prices Continue to Rise Buying a house in Portugal has become more financially demanding. The median price of houses reached €3,076 per square metre at the end of February, reflecting a 12.2% annual increase and a new historical high for the fourth consecutive month. Market dynamics remain intense, with strong demand and limited available supply. The current economic context helps explain this trend. Interest rates remain relatively accessible, employment remains stable, and incentives for home purchase persist, including support aimed at young buyers. At the same time, the construction of new houses has not kept up with demand, which puts pressure on market prices. Major Cities with Significant Increases The trend of appreciation is visible in almost all district capitals. Santarém, Beja, and Guarda stand out with annual increases above 20%, showing that the price rise is not concentrated only in large urban centres. Lisbon continues to lead as the most expensive city to buy a house in Portugal, at €6,059 per square metre, followed by Porto and Funchal. Faro and Setúbal also show values above €3,000 per square metre. In contrast, cities such as Portalegre, Castelo Branco, and Guarda maintain prices below €1,100 per square metre, despite recent appreciation. The only capital to record a slight decrease was Vila Real, going against the general upward trend. Districts and Islands Follow the Appreciation At district level and in the autonomous regions, the appreciation is equally significant. Only one territory remained stable, while the others recorded increases, some quite marked. Porto Santo island leads the annual rise, followed by territories such as Terceira, Setúbal, and Viseu. Lisbon remains the most expensive district to buy a house in Portugal, at €4,653 per square metre, followed by Faro and the Autonomous Region of Madeira. Conversely, Guarda, Bragança, and Portalegre present the lowest values in the country. All Regions Record Higher Prices In the last 12 months, all regions recorded price growth. The Autonomous Region of the Azores shows the highest annual increase, followed by Alentejo and the Autonomous Region of Madeira. The Lisbon Metropolitan Area continues to be the most expensive region to buy a house in Portugal, with a median value of €4,350 per square metre. The Algarve and Madeira consolidate as high-value markets, while the Centre remains the most affordable region, with a median price of €1,766 per square metre. The recent evolution confirms that buying a house in Portugal continues to be an increasing challenge. The combination of strong demand, limited supply, and an economic context favourable to acquisition keeps pressure on prices, making access to housing increasingly demanding for families.
Source: Adobe Stock Author: Redaction Bank valuations reach new historic high Buying a house with a mortgage always requires a bank valuation, essential for loan approval. In January 2026, the median bank valuation in Portugal reached €2,105 per square metre (m²), a new record. Compared to December 2025, this represented an increase of 1.2%, while the year-on-year rise was 18.7%, confirming the continuous upward trend in property values. The National Statistics Institute (INE) indicates that 31,316 valuations were considered, of which 19,429 were flats and 11,887 were houses. This figure represents a decrease of 11.2% compared to the same period in 2025, reflecting a slight slowdown in the volume of bank valuations. Flats with significant appreciation Flats recorded a median valuation of €2,447/m², representing a 22.8% increase compared to January 2025. The regions with the highest values were Greater Lisbon (€3,269/m²) and the Algarve (€2,796/m²), while Alentejo and the Centre showed the lowest values, €1,506/m² and €1,560/m² respectively. The T1, T2 and T3 types were the most valued, accounting for 92.8% of the total. T1 flats fell slightly to €3,099/m², T2 rose to €2,529/m², and T3 increased to €2,121/m². Compared to December 2025, the median value rose 1.3%, with Oeste and Vale do Tejo showing the largest growth (2.4%). Houses show solid increases Houses had a median value of €1,527/m², reflecting a 15.2% increase compared to the previous year. Greater Lisbon (€2,788/m²) and the Algarve (€2,703/m²) had the highest values, while the Centre (€1,135/m²) and Alentejo (€1,223/m²) remained at the lowest levels. Among the most valued houses, T2, T3 and T4 types accounted for 88% of the total. T2 rose to €1,514/m², T3 increased to €1,497/m² and T4 to €1,587/m². January also saw a monthly increase of 0.7%, with the Algarve leading the rise (2.8%) and the Azores showing the only decrease (-0.7%). Regional trends and outlook for 2026 The regions with the highest year-on-year growth were the Setúbal Peninsula (27.1%) for total housing and Oeste and Vale do Tejo (20.2%) in the houses segment. For flats, the Azores stood out with a year-on-year increase of 29%, despite recording a slight monthly drop of 1.6%. These figures confirm that, despite a slight reduction in the number of valuations, property appreciation remains consistent across the territory, reflecting strong demand and limited supply. The trend for 2026 indicates that bank valuation will continue to be a key indicator for the Portuguese real estate market, directly influencing the prices applied in house purchases with mortgage financing.
Source: Adobe Stock Author: Redaction Buying a house requires more than half of the income Buying a house in Portugal is increasingly difficult. A couple with an average salary needs to dedicate around 53% of their income to acquire a T2 apartment and 55% to buy a T3 house. In other words, more than half of the monthly budget is channelled only to paying the mortgage. This level of effort exceeds the 50% threshold, frequently pointed out as the maximum limit recommended by the Banco de Portugal. In practice, many experts argue that the ideal effort rate should not go beyond 30% to 35%, in order to guarantee financial stability and margin for other essential expenses, such as food, transport, education, or savings. It is important to emphasise that these values refer only to mortgage credit. When other financial commitments are added, such as car loans or credit cards, the real effort rate can be even higher, aggravating the risk of default. Districts where buying a house is more difficult Regional differences are expressive and show a country at two speeds in housing access. In the Autonomous Region of Madeira, a couple needs around 70% of their salary to buy a house, in the case of a T2 apartment. For a T3 house, the mortgage can exceed 100% of the combined income, making it practically impossible to buy a house under these conditions. Also in Lisbon and Faro, the effort rate to buy a house is around 59% and 68%, respectively, reflecting prices per square metre well above the national average and strong demand, including international. Inland districts offer greater margin In contrast, inland districts present much lower levels of effort to buy a house. In Portalegre or Bragança, a couple may need only 14% of their income to acquire a T2 apartment. Also in Guarda and Beja, the values remain below 25%, revealing greater housing accessibility. Even so, when analysing the situation of those trying to buy a house alone, the scenario worsens significantly. In several districts, a single salary is not enough to cover the monthly mortgage, especially in urban and tourist areas. Buying a house has thus become an increasing challenge for young couples, singles, and single-parent families, in a market marked by strong regional disparities and a relationship increasingly unbalanced between salaries and housing prices.
Source: Adobe Stock Author: Redaction Buying a house or renting: increasingly unbalanced costs The decision between buying a house or renting has always been central for those seeking housing independence. However, the current property market context has profoundly changed this equation. The shortage of rental homes and the continuous rise in rents have made renting a financially heavier option. In many cases, buying a house with a mortgage proves to be more advantageous , even with high sale prices. High rents push families towards buying property The rental market is under strong pressure, with limited supply and monthly costs consuming a large part of family income. This reality is leading many households to reconsider buying a house as an alternative. Despite the initial investment, the monthly mortgage payment tends to be more predictable and often lower than the rent charged for similar properties. Falling interest rates reinforce the advantage of buying a house After the peak in interest rates observed since 2022, a more favourable monetary policy and greater inflation control have provided some relief on mortgage payments. This drop has made mortgages more accessible and increased the gap between buying a house and renting. In several cities, the monthly savings from buying a house can reach around €550, even when considering costs such as property tax, service charges, and maintenance. Practical example shows significant monthly savings In urban areas such as Porto, renting an 80-square-metre flat can exceed €1,390 per month. Buying the same property, including mortgage, taxes, and other expenses, would cost around €1,040 per month. This difference shows how buying a house can be financially more sustainable in the medium and long term, in a market where demand continues to far exceed supply. Buying a house has ceased to be merely a choice for stability and has become, for many families, the most rational financial option.
Source: Adobe Stock Author: Redaction High prices and limited supply make access to housing difficult Buying a house in Portugal continues to be a challenge for many families. In major cities such as Lisbon, Porto and Faro, access was already limited due to rising prices in recent years, and now this problem is extending to other districts. The number of district capitals where buying a house is considered affordable, that is, with costs below 50% of the household’s net income, has decreased in recent years, reflecting the growing difficulty for many families to find properties within their financial means. In addition, the effort required to finance a home has been rising, making buying a house in Lisbon, Porto and Faro practically unaffordable. The interior offers some leeway, but inequality remains Excluding the districts of Lisbon, Porto and Faro, the interior of the country still shows lower prices for buying a house. In Setúbal, an average 90-square-metre property costs around €225,540, while in Castelo Branco the price falls to €94,230. Monthly mortgage payments and rents also vary significantly. Setúbal has the highest costs, while Portalegre and Guarda offer the most affordable options. Even so, buying a house in the interior still requires a significant financial effort for many families, maintaining regional inequality in access to housing. Renting has also become more expensive and difficult The rental market mirrors the pressure in the purchase sector. Currently, 23 of the 41 municipalities analysed require rents above €1,000 for medium-sized properties, compared with just two municipalities in 2022. This trend shows that renting, just like buying a house, has become an increasingly demanding task for Portuguese families. Rising rents increase regional inequality and force many households to commit a large portion of their income just to secure decent housing. Families face smaller homes affordable only to a minority Property prices in Portugal have nearly doubled over the last decade and accelerated by 23.4% in 2025, while household incomes have risen much more slowly. Currently, only 48% of houses for sale are priced within the financial capacity of 77% of families, set at a maximum of €330,000. This situation forces households to accept smaller properties or focus on segments only accessible to a minority, deepening market imbalance. The median disposable income in Portugal remains below the EU average, further exacerbating the difficulty of buying a house and highlighting the need for structural solutions in the housing sector.
Source: Adobe Stock Author: Redaction IMT exemption boosts home purchases by young people The exemption from IMT and Stamp Duty enabled thousands of young people up to the age of 35 to buy their own home in 2025. In total, almost 61,000 young people benefited from this tax support, resulting in the acquisition of more than 41,000 properties intended for owner-occupied permanent housing. The average price of homes purchased under the IMT exemption exceeded €205,000, reflecting the high value of the housing market. Average house prices and tax benefit According to data released by the Government, the average purchase value of homes bought with IMT exemption stood at €205,700. On average, each property benefited from tax support of around €6,300. The measure included full or partial exemption from IMT and Stamp Duty, reducing the initial costs of purchasing a first home for young people. Impact of the IMT exemption on the housing market Despite the high number of beneficiaries, no official assessment was presented regarding the impact of the IMT exemption on housing demand and prices. Recent academic studies indicate that demand-side measures, such as the tax exemption and the public guarantee for young people, may have contributed to accelerating the rise in housing prices. Part of the savings obtained through the IMT exemption may have been absorbed by property price appreciation. Exemption limits and access criteria In 2025, the full IMT exemption applied to homes valued up to €324,058, while partial exemption covered properties up to €648,022. This support came into force in August 2024 and is intended exclusively for young people up to the age of 35 when purchasing their first owner-occupied permanent home. The measure remains one of the main public instruments supporting young people’s access to housing.
Source: Adobe Stock Author: Redaction House prices in Portugal start 2026 at historic highs The beginning of 2026 is marked by a new record in house prices in Portugal. The average value of homes for sale reached a new national high, reflecting a double-digit annual increase and confirming the ongoing upward trend in the property market. The rise in house prices in Portugal is driven by strong demand, supported by more accessible financing conditions and incentives aimed at home purchases , particularly for younger buyers. At the same time, housing supply remains limited. New construction is progressing at an insufficient pace to meet existing demand, creating additional pressure on house prices in Portugal. This structural imbalance continues to shape the property market at the start of the year. Cities with the highest increases in house prices in Portugal The rise in house prices in Portugal was felt in the vast majority of district capitals. The highest annual increases were recorded in inland cities, notably Guarda, Beja and Santarém, where rises exceeded 20%. These figures show that price pressure is no longer confined to the main urban centres. Lisbon remains the most expensive city in which to buy a home, followed by Porto and Funchal. However, mid-sized cities such as Faro, Setúbal, Aveiro, Coimbra and Braga continue to register significant increases, consolidating their position as increasingly valued property markets. Only one city recorded an annual decline, indicating that the overall trend in house prices in Portugal remains clearly positive. Districts and regions reinforce the upward trend in housing values All districts and regions in the country recorded increases in house prices in Portugal. Some islands stood out with very strong rises, reflecting growing interest in locations outside the mainland. Districts such as Guarda, Viseu, Setúbal and Aveiro also posted significant increases over the past year. At a regional level, the Azores led the increases, followed by Alentejo and Madeira. The Lisbon Metropolitan Area remains the most expensive region in which to buy a home, while the Centre continues to be the most affordable option, despite the recorded appreciation. The national picture confirms that house prices in Portugal continue to rise across the board, reinforcing the challenges in access to housing in 2026.
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