Porto tops Portugal’s housing boom with ~4,400 homes licensed in the first 10 months of 2025, a 75% build conversion rate and strong price growth.
Porto has emerged as the clear leader in new housing investment along Portugal’s Atlantic Axis, outpacing neighbouring Vila Nova de Gaia and Matosinhos both in project submissions and in turning plans into completed homes.
According to licensing data, roughly 4,400 new homes were submitted for approval in Porto in the first 10 months of 2025, the largest pipeline in the country. That follows intense activity over the previous two years, when 5,980 homes were submitted for licensing, signalling sustained developer interest in the city.
Porto is not just attracting projects — it is converting them into built supply at a higher rate than its neighbours. Combining 2023 and 2024 licensing and pipeline figures, Porto’s conversion rate stands at about 75%, compared with 56% in Vila Nova de Gaia and 36% in Matosinhos, and above the national average of 50%. Analysts say this reflects Porto’s stronger ability to compete for scarce construction resources and for higher-value projects in a market where capacity is constrained.
The housing push is occurring alongside a notable demographic turnaround. For the first time since the 1990s, Porto, Gaia and Matosinhos all recorded simultaneous population growth. Porto’s recovery has been the most pronounced: after a decline from 301,000 residents in 1991 to 233,000 in 2014, the city regained roughly 20,000 inhabitants between 2016 and 2024 — an annual growth rate of about 3%. Vila Nova de Gaia and Matosinhos together added roughly 20,000 people in the same period, with Gaia attracting around 12,000 and Matosinhos about 8,000 new residents.
“Porto is the city that attracts the most projects and where these are most likely to come to fruition, reflecting a greater ability to compete for resources in the construction sector, which is unable to respond to all orders and is obviously attracted by higher value markets,” one market expert observed.
Over the 2015–2024 period, Porto licensed 50.9 dwellings per thousand inhabitants — well above the national average of 21.9 and more than Matosinhos (29.4) and Gaia (40.3). By comparison, the eurozone average stands at roughly 49.4 dwellings per thousand, underscoring how high current activity levels in Porto are relative to national norms.
Price growth has followed the surge in activity. In October, the average sale price per square metre was €3,600 in Porto, €3,155 in Matosinhos and €2,488 in Vila Nova de Gaia (12-month cumulative). Year-on-year price increases in Q3 2025 were reported at 18.4% for Porto and 17.3% for Vila Nova de Gaia. Matosinhos showed an exceptionally large reported increase of 194% year-on-year — a figure that may reflect base effects or specific local market dynamics and warrants closer scrutiny.
Despite the momentum, experts caution that Porto alone cannot resolve regional housing shortages. Even with its strong licensing rate, the city’s output will need to be complemented by supply in Gaia, Matosinhos and other municipalities to meet growing demand.
What this means for buyers and investors: Porto remains a high-demand, high-value market with strong delivery rates, but rapid price growth and constrained construction capacity suggest competition will remain stiff. Investors should watch pipeline-to-construction conversion rates and local planning trends across the Atlantic Axis to assess where new supply — and opportunities — will materialize.
