Source: Adobe Stock Author: Redaction Municipality aims to triple housing supply Finding a home at a price that is compatible with household incomes remains a challenge in Porto. To help meet demand, the local authority is strengthening its commitment to affordable rental housing and intends to significantly increase the number of homes available under this scheme. The municipality has already delivered around 500 affordable rental homes. By the end of the current term, Porto City Council aims to reach 1,600 homes, increasing the supply available to families facing difficulties in the private rental market. This target requires a major expansion of the housing response promoted by the municipality, which is looking for new solutions to increase the number of properties covered by affordable rental housing. Renovation and construction among the solutions The local authoritys strategy involves using different models to create new affordable rental opportunities. Renovating existing buildings is one of the approaches being used, allowing properties to be restored and converted into housing. One example can be found in Cedofeita, where an old building is being renovated to create 25 new homes for this scheme. In addition to renovating properties, the municipality is also seeking homes from private owners and developing projects through Porto Vivo SRU. The construction of new buildings and partnerships with private entities are also part of the strategy to increase supply. More housing to meet demand The focus on affordable rental housing aims to create alternatives for people who cannot keep up with the prices charged in Portos property market. Increasing the supply could allow more families to find a housing solution with rent suited to their income. One of the models also being considered is build to rent, based on constructing properties specifically for rental. This solution makes it possible to integrate new projects into the municipal strategy and diversify the ways in which housing is made available. With several areas of action underway, Porto City Council aims to accelerate the creation of new homes and move closer to the target set for 2029. If achieved, the municipality will have significantly strengthened its ability to provide affordable rental housing in a city where demand remains high.
Source: Adobe Stock Author: Redaction Industrial investment increases pressure in Sines Sines is undergoing a period of major economic transformation, driven by large industrial projects that are expected to represent more than €20 billion in private investment. The increase in business activity is bringing new workers to the municipality and, with them, greater demand for housing. Against this backdrop, the Government intends to create a specific public investment plan to keep pace with the regions growth. The strategy is expected to cover several areas that are essential for the population, including housing, education, healthcare, nurseries, pre-school education and facilities for older people. The aim is to ensure that economic development is matched by adequate public service capacity. Housing is particularly important in this context, as rising demand has made it increasingly difficult to find available homes in the municipality. The property market feels the effects of growth Pressure on housing is already visible in local market prices. Rental availability is limited and prices are making it harder for families to access a home in Sines. Population growth helps explain part of this situation. Between 2021 and the end of 2025, the municipalitys population is estimated to have increased by more than 12%, equivalent to around 2,000 people. Demographic growth has not been matched at the same pace by the expansion of public services. For the municipality, this gap makes it urgent to find solutions for housing, as well as for areas such as healthcare and education. The shortage of housing could also affect how residents perceive the major projects arriving in the area. Economic development may be seen as an opportunity, but also as an additional source of pressure on the property market. Government prepares an unusual response The Government considers that the scale of investment in Sines justifies an approach different from the one usually applied in other municipalities. The areas specific circumstances are therefore expected to underpin a joint plan with the local authority. The response should seek to anticipate the needs created by economic growth, preventing shortages of housing and public services from limiting the areas ability to attract workers and new families. In addition to housing, infrastructure investment is expected to cover healthcare facilities, educational establishments and social support services. Creating suitable conditions will be crucial to keeping pace with the municipalitys expected development. Municipality calls for greater return from investment The local authority also argues that companies developing projects in Sines should play a greater role in creating new services and facilities for the population. The idea is to link private investment to mechanisms that can strengthen local capacity. One of the proposals is to revise the Local Finance Law, ensuring that the municipality can benefit more directly from the economic activity generated within its territory. The municipality has also suggested establishing local agreements with the companies behind the major investments. These solutions could help finance new infrastructure and respond to growing demand for housing. Despite its concerns, the local authority remains supportive of private investment in Sines. The priority now is to ensure that economic growth is accompanied by affordable housing and public services capable of meeting new needs.
Source: Adobe Stock Author: Redaction Land protected for two years The Regional Government of Madeira has introduced measures to protect a 29,000 sq m area in the São Martinho parish of Funchal for future public housing development. The site has been identified as suitable for new affordable housing developments. The decision aims to prevent interventions that could hinder or increase the cost of the projects planned for the area. The preventive measures are set out in a regulatory decree published in the Official Gazette and will initially remain in force for two years. This period may be extended by a further year. During this time, several types of work in the area will require prior authorisation from the Regional Secretariat for Equipment and Infrastructure, following consultation with Funchal City Council. Construction and other works restricted Protecting the site means that a wide range of interventions will be subject to restrictions. The construction of new buildings, as well as rebuilding, extensions, alterations or demolition works, will require authorisation. The creation of new residential areas and the installation or expansion of certain activities on the site will also be covered. Other restricted interventions include excavation and earthworks, tree removal and the installation of cesspits or waste storage facilities. The rules also apply to certain works involving existing structures, such as painting buildings or walls, as well as hydraulic works, including water abstraction and diversion. The authorisation required under the decree does not, however, replace any other licences, authorisations or legal requirements that may be imposed by other authorities. Funchal gains space for new projects According to the Madeira regional government, the site has significant potential for future affordable public housing projects. Protecting the area is intended to create the conditions needed to increase the supply of affordable housing in the region. The measure forms part of the regional strategy to develop new housing solutions and secure land that can be used for this purpose. The regulatory decree establishing the preventive measures was approved on 6 August. Safeguarding the site will therefore keep an area considered strategic available for future housing developments in Funchal.
Source: Adobe Stock Author: Redaction Loans for buying homes continue to grow Household debt to banks for buying homes increased again in July. According to data from the Bank of Portugal (BdP), the mortgage lending stock reached €118 billion, setting a new all-time high. In a single month, the loan portfolio increased by around €1.2 billion. This is the largest monthly increase since December 2009, highlighting the continued strong momentum in the mortgage lending market. The increase comes amid strong demand for financing, following a period in which interest rates put pressure on household budgets and encouraged many borrowers to make early repayments on their loans. Public guarantee influences demand among young buyers Demand for mortgage lending has also been supported by access to the public guarantee scheme for young buyers. The mechanism came into force at the beginning of 2025 and aims to facilitate financing for the purchase of a first permanent home, subject to the applicable conditions. The programme initially had a €1.2 billion allocation, which was later increased to €2.3 billion. The measure has helped boost demand for financing among younger buyers. At the same time, changes to lending rules may have prompted some households to bring forward their financing applications before the new conditions came into force. Lower interest rates reduce early repayments The evolution of mortgage lending is also linked to changes in interest rates. After the high levels recorded in recent years, lower borrowing costs have made early loan repayments less attractive. In 2023 and 2024, many households chose to reduce their debt as repayments increased. With a less pressured interest-rate environment, this trend has weakened, contributing to the growth in total outstanding debt. Lending to households and businesses also rises The increase was not limited to mortgage lending. Total loans granted to individuals, including housing and consumer finance, reached €153.5 billion in July. Business lending also recorded positive growth. The stock of loans to companies increased by €438 million compared with the end of June, also reflecting greater use of bank financing. The data therefore show that mortgage lending continues to gain ground and reach new highs in a market marked by significant demand for financing to buy homes.
Source: Adobe Stock Author: Redaction Plots priced below market rates Arraiolos Town Council is strengthening its strategy to increase the housing supply by making land available for construction at affordable prices. According to the municipality’s president, Jorge Macau, there are opportunities in all localities across the municipality, with prices well below those practised in the market. The plots are being made available at around €25 to €30 per square metre. The measure aims to facilitate access to land and encourage housing construction at a time when the shortage of homes remains a challenge in several regions of the country. 14 more plots in preparation Earthworks are currently underway to create 14 new plots. The municipality also plans to continue increasing the supply and is considering a larger-scale project. The local authority expects to begin work within one to two years on a development that should provide around 100 plots. The initiative will expand the options for those wishing to build a home in the municipality. The strategy therefore involves making land available in different localities, seeking to respond to the needs of people who want to settle in Arraiolos. Municipality recovers unused plots In addition to creating new plots, Arraiolos Town Council is recovering plots that had previously been allocated but were not used within the established deadlines. These plots will be placed back on the market, increasing availability for future construction projects. With these measures, the municipality aims to make use of existing land and create new opportunities for housing construction, while maintaining an affordable pricing policy for those looking to build a home in Arraiolos.
Source: Adobe Stock Author: Redaction Rooms place a major strain on budgets The cost of student housing is creating difficulties for many students in Coimbra. According to an online survey by the Coimbra Academic Association (AAC), with 1,039 validated responses, 24.6% of participants have considered suspending their enrolment or dropping out of higher education due to the associated costs. Accommodation is one of the main expenses. The average price of a room in Coimbra is €312, while 65.2% of surveyed students pay at least €300. The expense also represents a significant share of monthly budgets. Around 28.6% of participants spend between 51% and 70% of their monthly budget on accommodation, while 12.3% spend more than 70%. Lack of rental contracts concerns students Rental conditions are another concern identified by the survey. Around 32% of students who took part in the study say they do not have a formal contract for the room they rent. This situation may leave students more exposed to rental-related problems and make it harder to access protection mechanisms. At the same time, 52.7% of respondents consider that housing prices and availability have partially or completely influenced their choice of city or higher education institution. The results highlight the impact that access to housing can have on academic decisions and students’ ability to remain in higher education. AAC proposes new measures for accommodation In light of the results, the AAC is calling for changes to student rentals. One proposal is the creation of a specific contract for student accommodation, with limits on deposits and clearer rules for students and landlords. The association also proposes more regular monitoring of prices through the Student Accommodation Observatory and a public accommodation platform, with state certification. In the long term, the proposed solution involves increasing the number of public student residences and beds. To address current difficulties, the AAC considers more immediate action on access to student housing necessary.
Source: Adobe Stock Author: Redaction Fewer transactions in a high-price market The Portuguese property market went through the first six months of 2026 with a reduction in the number of transactions, in a context marked by limited supply and rising house prices. The turnover of the main estate agency networks increased, alongside the appreciation of the properties sold, and data from the National Statistics Institute (INE) help explain this trend. In the first quarter of 2026, the median price per square metre paid by buyers whose tax residence was abroad was 29.7% higher than the amount paid by domestic buyers. This difference was even more significant in Greater Lisbon, where it reached 34.5%, while in the Algarve it stood at 24.5%. Higher prices help sustain the business The rise in prices has partially offset the reduction in the number of sales. As each property represents a higher transaction value, estate agency commissions can remain stable or increase even when the number of transactions falls. The shortage of available housing therefore remains one of the main factors to monitor. Lower supply limits the number of transactions but keeps pressure on prices in a market where demand remains higher than the number of properties available in several areas. The market also reveals differences between the various buyer profiles. In addition to domestic and foreign private buyers, companies have been gaining weight in residential transactions. According to the INE, financial and non-financial entities paid a median price of €2,142 per square metre in the first quarter, 33.8% more than in the same period of the previous year. Foreign demand maintains its market share Buyers whose tax residence is abroad continue to represent a significant share of demand, particularly in areas with stronger international demand and in higher-priced segments. The higher amounts paid by these buyers help explain the difference between the evolution of the number of transactions and the financial performance of the estate agency sector. Even with fewer transactions, higher-value deals can contribute to increasing turnover and revenue. Nevertheless, domestic demand continues to play a central role in the residential market. For many Portuguese households, rising prices have made access to housing more difficult, particularly in a context of limited supply. Thus, the first half of 2026 leaves a property market marked by two distinct trends: fewer transactions, but higher sale values. Until supply increases consistently, prices and the ability to secure new property listings are likely to remain key factors in the sectors performance.
Source: Adobe Stock Author: Redaction Bairro de Frende enters public ownership Baião City Council acquired Bairro de Frende, in the parish of the same name, for €150,000. The housing complex had been abandoned for more than 30 years and is now expected to be restored to create new housing solutions. The acquisition is part of the update to the Local Housing Strategy for 2027-2032 and brings the property into public ownership. Of the 16 existing homes, which are very old and small, the council expects the final number of housing units may be lower following the intervention. The municipality intends to use this property to respond to local housing needs and revitalise an area that has remained unused for several decades. Municipality wants to restore former cinema The intervention may not be limited to Bairro de Frende. The council is also considering the restoration of Cine-Alvorada, a former cinema in the same parish, built by the person responsible for creating the neighbourhood. The site has historical value for the local population and is part of a group of heritage assets that the municipality intends to restore. The project is still being prepared, with meetings already held to define a possible future use. The housing strategy also includes the restoration of former schools for housing, the creation of plots and buildings for affordable rental. Baião City Council is also preparing regulations for affordable rental and the Baião Arrenda programme, which is expected to include tax benefits for owners who make properties available on this market. Baião identifies more than 300 families Municipal data indicates that 326 families are eligible for the Primeiro Direito programme due to inadequate housing conditions and financial difficulties. Addressing these needs is one of the main challenges of the strategy through to 2032. The aim is to reach as many households as possible, including young people who face difficulties leaving their parents’ homes. The municipality estimates an investment of around €47 million to implement the housing strategy. In addition to restoring municipal properties, the plan includes identifying private homes available for rental and preparing future applications for EU funding. The restoration of heritage is therefore one of the municipality’s priorities for increasing the supply of housing and revitalising currently unused spaces.
Source: Adobe Stock Author: Redaction Mortgage payments increase as Euribor rises Mortgage payments will increase again in August following the rise in Euribor rates during July. The three main maturities all ended above 2.4%, with the 12-month Euribor standing out at 2.855%, its highest level since the end of 2024. Although the European Central Bank kept its key interest rates unchanged at its latest meeting, instability in international markets and expectations of further interest rate hikes contributed to the rise in Euribor. This means higher borrowing costs for those taking out a new mortgage, as well as for existing borrowers with variable-rate loans. Mortgage lending faces new restrictions In addition to higher mortgage payments, buyers are also facing stricter lending rules. Since August, the maximum debt-to-income ratio considered by banks has been reduced to 45%, limiting access to mortgage financing. This change may restrict the approval of new loans, particularly for households with lower incomes. At the same time, rising interest rates continue to put pressure on household budgets, making home purchases more challenging. For borrowers with mortgages indexed to Euribor, the reviews scheduled for August are also expected to reflect higher repayments than in previous revisions, in line with the increase in benchmark rates. How to reduce the impact of mortgage payments In this context, there are several ways to reduce the impact of higher mortgage payments. Available options include renegotiating the spread with the bank, switching to a mixed or fixed-rate mortgage, or transferring the mortgage to another financial institution offering more competitive conditions. The size of the increase will always depend on the outstanding loan balance, the remaining loan term and the chosen index. Even so, reviewing mortgage conditions regularly may help borrowers find more favourable alternatives. Anyone planning to buy a home should consider not only the propertys value but also interest rate trends and the stricter lending requirements to ensure a financially sustainable decision in the long term.
Source: Adobe Stock Author: Redaction State Guarantee boosts home purchases The State Guarantee for young people up to the age of 35 continues to have a strong impact on the housing market. By the end of June, this scheme had financed the purchase of around 40,000 homes, with a total value of €8.3 billion. The latest figures show that more than half of the funding allocated to this support has already been used. The scheme was created to make it easier for young people to buy their first home. It allows the State to guarantee up to 15% of the propertys value, enabling banks to finance up to 100% of the purchase, provided the property price does not exceed €450,000. Mortgage lending grows among young people Between April and June, the number of mortgage contracts signed under the State Guarantee increased once again. During this period, around 7,800 contracts were signed, representing financing of approximately €1.7 billion. Compared with the previous quarter, both the number of contracts and the amount granted increased. Currently, more than half of the mortgage loans taken out by young people up to the age of 35 for home purchases use this scheme, highlighting its importance in improving access to mortgage finance. Across the market as a whole, the State Guarantee accounted for almost one-third of the mortgage contracts for the purchase of permanent homes signed during the second quarter. Regional differences remain The use of the State Guarantee is not uniform across Portugal. Some inland regions show a higher percentage of young people using the scheme, while the relative share is lower in the Lisbon Metropolitan Area and the Autonomous Region of Madeira. Even so, around half of all contracts signed since the programme began are concentrated in Greater Lisbon, the Porto Metropolitan Area and the Setúbal Peninsula, reflecting the higher demand for housing in these regions. Scheme remains available until the end of the year Since the programme began in 2025, the State Guarantee has already supported 40,100 mortgage contracts, representing almost half of the loans granted to young people up to the age of 35 for the purchase of their own home. The scheme remains available for contracts signed until 31 December this year and continues to be one of the main measures supporting young people in accessing home ownership.
Source: Adobe Stock Author: Redaction New mortgage rules are now in force The new mortgage rules came into force on 1 August and introduce significant changes to lending criteria. The measures defined by the Bank of Portugal aim to strengthen households financial sustainability in a context of growing indebtedness. The main changes include a lower recommended debt-to-income ratio, new loan term rules and changes to maximum financing limits. What changes for mortgages? The main change concerns the debt-to-income ratio, which represents the percentage of monthly income allocated to loan repayments. The recommended limit falls from 50% to 45%, making mortgage applications subject to stricter assessment. Financial institutions may still approve loans above this threshold, but only for a small proportion of new loans granted each semester, provided that the decision is properly justified. Maximum repayment terms have also been simplified. Customers aged up to 35 can take out a mortgage with a maximum term of 40 years, while those over 35 will have a maximum repayment period of 35 years. Financing and debt-to-income ratio under the new rules Another important change concerns the amount financed by banks. It is no longer possible to obtain 100% financing for properties owned by banking institutions. The new limits are: Up to 90% for owner-occupied permanent homes; Up to 80% for other housing-related purposes. These changes may reduce the maximum mortgage amount available to some buyers, particularly those with lower incomes or existing loans. As the debt-to-income ratio becomes more restrictive, some households may no longer qualify for the same financing amount they could previously obtain. Who is likely to be most affected? The new rules are expected to affect mainly consumers with lower financial capacity, households already repaying other loans and buyers seeking a high level of financing. When assessing mortgage applications, banks will continue to evaluate income, existing financial commitments and the ability to cope with potential interest rate increases through stress tests. Comparing offers from different banks, reducing existing debts and simulating different scenarios may therefore make a difference when applying for financing. Why were these rules changed? The new measures come at a time when Portuguese household debt has been rising significantly. Their aim is to promote more prudent mortgage lending, reduce the risk of over-indebtedness and strengthen the stability of the financial system. For anyone planning to buy a home, it is now even more important to prepare in advance, understand their debt-to-income ratio, gather all the necessary documentation and compare the different financing options available before submitting a mortgage application.
Source: Adobe Stock Author: Redaction More investment in affordable housing The Leiria Region will benefit from an additional €21.24 million allocated to affordable housing following the reprogramming of the Integrated Territorial Instrument (ITI). The agreement was reached between the Intermunicipal Community (CIM) of the Leiria Region and the Centre Regional Coordination and Development Commission (CCDR Centro). The new funding will reinforce the resources already available for this area and support the implementation of the Viver Região de Leiria Intermunicipal Agency, considered a key element in delivering affordable housing projects across the region. In addition to this amount, the ITI reprogramming includes a further €8.8 million for other investment areas. Overall, the funding increases from around €105 million to €135.75 million. Programme plans new homes The investment in affordable housing is part of the Intermunicipal Affordable Housing Programme, announced by the CIM to increase the supply of homes in the region. The aim is to create between 350 and 500 homes across the ten municipalities that make up the intermunicipal community. The programme intends to provide rents between 20% and 40% below market value, making housing more accessible for young people, families and key public service workers, while also promoting urban regeneration and energy sustainability. Viver Região de Leiria Agency coordinates projects The programme will be implemented by the Viver Região de Leiria Intermunicipal Agency, responsible for developing affordable housing solutions through the refurbishment of vacant properties, new construction, the acquisition of strategic buildings and the establishment of partnerships between public and private entities. The Intermunicipal Community of the Leiria Region includes the municipalities of Alvaiázere, Ansião, Batalha, Castanheira de Pera, Figueiró dos Vinhos, Leiria, Marinha Grande, Pedrógão Grande, Pombal and Porto de Mós. Funding strengthens the regional strategy The additional funding represents an important boost to the Leiria Regions development strategy until 2030. Through affordable housing, the CIM aims to respond to the populations housing needs, increase the supply of homes at controlled prices and help attract and retain residents and workers in the region. With more investment available, the intermunicipal community expects to accelerate the implementation of the planned projects and strengthen its response to current housing access needs.
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