Portugal’s short-term rentals investment is booming as foreign capital pours into the market to meet the needs of a growing number of tourists. Learn how international investors are fueling the expansion of Portugal’s local accommodation sector.
Portugal’s Short-Term Rentals Investment Hits New High
Foreign ownership of short-term vacation rentals in Portugal is on the rise, with US investors entering the top five for the first time, according to the latest data from the National Registry of Local Lodging (RNAL). While nearly 94% of Portugal’s 124,000+ registered local accommodation units are still held by nationals, the presence of foreign investors is steadily increasing—particularly in the country’s most coveted tourist hotspots.
Americans Move Into the Top Five of Foreign Owners
Foreign investor diversity is growing, with owners hailing from over 100 countries. British, French, and German citizens have long dominated the foreign market for local lodging, but Americans are now making a significant impact. With 455 registered short-term rental units, US citizens now rank as the fifth-largest foreign owner group. This surge parallels a rise in US residents moving to Portugal, which has topped 20,000 people—many seeking both residency and investment opportunities.
Ownership Breakdown by Nationality:
- United Kingdom: ~1,762 units
- France: ~1,300 units
- Germany: 700+ units
- Brazil: Still relevant, but outside the top three
- United States: 455 units—a rapidly growing share
Investment Focus: Algarve and Lisbon Remain Hotspots
Foreign short-term rental ownership concentrates strongly in Portugal’s main tourism corridors.
- Over 70% of British and German-owned units are located in the Algarve, renowned for its sunny beaches.
- More than half of French and US owners also prefer the Algarve, while Lisbon and Faro remain highly sought after.
- In contrast, national owners maintain a wider geographic spread across all districts.
Direct Ownership: Foreigners Bet on Asset Control
A noteworthy trend: The majority of foreigners directly own the properties they operate as rentals, signaling a long-term asset-based approach. In comparison, only about 59% of Portuguese owners also own the buildings they rent short-term; the remainder lease properties for tourist use.
Tourism Boom Fuels Short-Term Rental Demand
Portugal’s popularity with global tourists is a key driver of this investment boom. In 2024 alone, over 1.3 million Americans visited Portugal, catapulting the US into one of the largest sources of international visitors. This surge is organically linked to the rise in US-based property ownership and underscores the growing relationship between tourist demand and the supply of short-term rentals.
The Shift Toward Internationalization
While Portuguese nationals still control the vast majority of local accommodation, the evolving, diversified profile of foreign investors—especially from the US—demonstrates a clear trend toward real estate internationalization. This reflects Portugal’s status as a stable, attractive destination capable of luring international capital and transforming the landscape of local accommodations.
Portugal’s short-term rentals investment market is experiencing increasing internationalization, with Americans now among the top five foreign owners. The focus remains on high-demand regions like Lisbon and the Algarve, fueled by skyrocketing tourist arrivals. As foreign investors continue to diversify and expand their presence, Portugal’s local accommodations sector is set for even greater global integration in the years ahead.
