The Portuguese real estate market continued its upward trajectory in 2025, with both house prices and rents reaching new heights. According to recent data, buying or renting a home in Portugal has become significantly more expensive compared to 2024—a trend that’s especially pronounced in Lisbon and the northern regions.
Steep House Price Increases Across the Country
Overall, house prices in Portugal jumped by an average of 20% compared to last year. Lisbon, the nation’s capital, saw the most dramatic surge, with prices skyrocketing 30% to reach an average of €650,000 per home, maintaining its position as the most expensive district to buy property.
Elsewhere, the districts of Santarém and Beja matched Lisbon’s growth, both recording price increases of 30%. Coimbra saw a rise of 24%, while Portalegre, Setúbal, and Faro registered increases of 21%, 20%, and 19%, respectively. The city of Porto, still the priciest in Portugal’s North, posted a more modest increase of 13%, setting the average property price at €404,000. Bragança bucked the national trend, witnessing a 5% price drop to €115,000.
Island Regions Experience Strong Price Hikes
Portugal’s Autonomous Regions also faced substantial house price increases. In Madeira, average property values hit €575,000—up 19% from last year. Porto Santo posted a remarkable 37% increase, with average prices standing at €480,000. In the Azores, São Miguel saw prices climbing 35%, with homes now averaging €390,000. These sharp rises reflect a tourist-driven demand and limited housing supply, especially on the islands.
Rents Rise, Especially in the North
Rents in Portugal also rose in 2025, albeit at a slower average pace of 4%. The most notable increases were observed in the North, where rents in Guarda soared by 31%, climbing from €400 to €525. Vila Real wasn’t far behind, with a 22% hike to €600. Other significant rent hikes occurred in Bragança (15%), Faro (14%), and Évora (13.5%).
Lisbon rents remained comparatively stable, nudging up just 0.3% to €1,655, while Porto saw a 4% rent decrease, currently averaging €1,150. In Madeira, rents rose by 10%, and São Miguel in the Azores saw a significant 25% jump, setting the average at €1,000.
What’s Driving the Price Growth?
Several factors are fueling this sustained appreciation in both sale and rental markets:
- Limited housing supply in key urban and tourist areas.
- Consistent domestic and international demand for Portuguese real estate.
- Increasing investment in regional and island markets, given their tourist appeal.
- A structural trend of appreciation across regional markets, especially in the North and the islands.
A Competitive, Dynamic Market
With prices and rents at record highs, Portugal’s real estate market remains dynamic—but also more challenging for both buyers and renters. Prospective homeowners and tenants are urged to plan carefully and stay informed, as competition for both purchases and rentals is set to remain fierce, particularly in Lisbon, Porto, and tourist-heavy areas.
For the latest updates on property prices and rental trends in Portugal, stay tuned to our real estate coverage.
