House price index
Portugal's house price index has been rising steadily since 2016, making the country one of the strongest markets in Europe. Despite lagging behind in overall economic development, Portugal benefits from a low-base effect that creates the conditions for sustained, long-term growth.
Number of real estate transactions
The number of property transactions is also rising steadily.
Average price per square metre
The price per square metre has been rising steadily since 2015, showing a healthy and sustained upward trend.
The average price per square metre in Portugal still has considerable room to grow compared with Spain. At the same time, a relatively foreigner-friendly policy stance — even after several incentive programmes were discontinued — continues to support further growth.
Foreign demand
The key growth driver is foreign demand, which almost doubled between 2020 and 2025.
Moreover, over the past five years foreign buyers have accounted for more than 60% of market growth. Portugal's climate, relatively affordable prices and strategic geographic location continue to attract large numbers of international buyers.
Main foreign buyers
The most active buyers of Portuguese property are citizens of the United States, the United Kingdom, France and Germany, who account for 89% of all transactions involving foreigners.
Rental yield
Rental yields are highest in the country's smaller cities and lowest in Lisbon. The average yield stands at 4.85%, in line with the European norm.
Portugal today represents Europe's “safe haven”. The country pursues no aggressive political agenda and focuses consistently on development and on attracting foreign investment.
New opportunities are opening up for Portugal against the backdrop of the current political situation in Spain, where the introduction of laws restricting property purchases by foreigners looks increasingly inevitable. Part of the demand that can no longer be met in Spain is likely to shift to Portugal, leading to further inflows of foreign capital.
The availability of mortgage financing for non-residents is of particular importance for the property market.
Portugal also faces numerous administrative and environmental restrictions on new construction, which contributes to a structural shortage of supply.
The most attractive investment opportunities are concentrated in small but popular cities that are highly valued by foreign buyers and do not suffer from oversupply.
In addition, commercial property in Porto and Lisbon offers strong investment potential.
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