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The Portuguese Real Estate Market in 2024

If you’re considering moving to Portugal or investing in properties here, understanding the Portuguese real estate market in 2024 is crucial for making informed decisions and seizing the best opportunities. At Pearls of Portugal, we’re here to guide you through every step of buying or renting a home in Portugal, providing expert knowledge and personalized assistance to make your experience as smooth as possible. Let’s find out more!

Frederik Pohl
Frederik Pohl, CEO
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The state of the Portuguese real estate market in 2024

House prices and rents in Portugal have experienced steady growth in recent years, reflecting the country’s increasing demand for properties. The market in 2023 in terms of overall sales slowed down and properties were on the market longer before finding a buyer. Although sales volume fell in 2023 from the record level set the previous year, it was still 3% above 2019. Inflation, high construction costs, and rising interest rates contributed to the price correction in 2023. Europe as a whole has already fallen by around 2%, according to Eurostat data.

In 2024, we continue to observe this trend, with average prices per square meter varying according to the property location and characteristics. While urban areas like Lisbon and Porto have higher prices, there are more affordable options in secondary cities and rural regions. Additionally, rental values have followed this trend, especially in metropolitan areas and popular tourist destinations.

Despite a slight dip in the number of houses sold in 2023, analysts remain optimistic about the outlook for the current year. The first quarter in 2024 reflects the resilience of the Portuguese real estate market, offering reassurance to investors seeking growth opportunities and people looking to move and/or retire permanently here. Buyers who have been waiting for the opportunity to invest in a new home are lucky – the supply of houses for sale grew 11% last year.

portuguese real estate market 2024
Porto, Portugal

Buying in Portugal 2024

Despite a slight dip in the number of houses sold in 2023, analysts remain optimistic about the outlook for the current year. A total of 131.682 homes were sold in Portugal in 2023, of which 88% are being lived in. When evaluating the average house prices for sale, there was already a slight increase of 2% in January of 2024 compared to December of last year – the average purchase price is at €325,000.

Houses for sale became 1.9% more expensive between January and March 2024 compared to the previous quarter, showing slower growth (+2.8%). It is evident that house prices continue to decelerate in half of the 20 district capitals analyzed, with highlights including Bragança, Ponta Delgada, and Castelo Branco. On the other hand, Setúbal, Porto, and Lisbon are part of the other half, where an acceleration in housing costs happened between quarters. Lisbon, for example, rose by 5%, now standing at €450,000, having been the district with the highest increase in the average selling price compared to last year.

The cheapest districts to buy a house in Portugal in 2024 are naturally located in the inland regions – Portalegre and Guarda. These areas are particularly great if you’re looking to renovate an old house or homestead here – a quite popular trend nowadays. Pearls of Portugal is, of course, here to help you with that!

real estate market 2024 portugal - house sales
Statistics on house prices at local level - 2023. Source: INE

Renting in Portugal in 2024

At the end of 2023, the average national rent was 7.71 €/m2. A number that represents a year-on-year growth of 11.6%. INE (National Statistics Institute) predicted that rents in the market would increase by 6-8% this year. So far, the institution has been proven right. According to idealista, in January rents had already risen in many Portuguese districts, such as:

  •  Vila Real (+14%) – €625
  • Bragança (+12%) – €475
  • Portalegre (10%) – €550
  • Castelo Branco (10%) – €550
  • Coimbra (+10%) – €700
  • Santarém (+9%) – €790

The district that recorded the highest decrease in average rent in January was Guarda, dropping by 15% to €425 – a great option for those looking for the peace and quiet of rural living. Besides Guarda, the cheapest Portuguese districts to rent a house in right now are Bragança (€475), Portalegre (€550), Viseu (€600), and Vila Real (€625). The most expensive ones continue to be Lisbon (€1,800), Setúbal (€1,200), Porto (€1,150), and Faro, in the Algarve (€1,100).

real estate market 2024 portugal - rentals
House rental statistics at local level - 2023. Source: INE

Cultural diversity and internationalization in the Portuguese real estate market

The real estate landscape in Portugal boasts a striking feature that sets it apart from many other markets: its remarkable cultural diversity and international appeal. In 2022, foreigners bought more than 12% of the houses sold in Portugal. The composition of property buyers has become increasingly diverse, encompassing a broad spectrum of nationalities and buyer profiles in recent years.

In 2023, almost 800,000 foreigners were in Portugal – almost 10% of the population. In places that are particularly popular amongst foreigners, like the Algarve, 18% of residents are foreign, a number that rises when you get to cities like Albufeira (35,8% foreign population), which is especially famous between English-speaking retirees. However, the increase in the foreign population is a phenomenon that has been going on since 2016, when the numbers were below 400 thousand people. Foreigners buy houses that are 43% more expensive than Portuguese nationals, according to data from the INE.

In terms of purchasing trends, the preferences and priorities of buyers vary significantly depending on their nationality, background, and individual circumstances. While some may gravitate towards luxurious properties in the big cities, like Lisbon and Porto, others seek the beautiful beaches and (almost!) guaranteed year-long sunny weather of the Algarve, where foreigners purchased almost 30% of the total of sold houses in 2023.

As Portugal positions itself as a global hub for investment, innovation, and cultural exchange, the real estate market stands at the forefront of this transformative journey.

Seizing the potential of the Portuguese Real Estate Market in 2024

As we delve into the real estate landscape of Portugal in 2024, it becomes evident that the opportunities for both buyers and renters are promising. In recent years, Portugal has experienced a consistent uptick in both the number of houses sold and rental contracts signed, underscoring the enduring appeal of its real estate market. This upward trajectory reflects the attractiveness of Portugal as a destination for property investment but also speaks volumes about the confidence investors place in the country’s economic stability and growth prospects.

If you’re ready to take the next step in your real estate journey in Portugal, Pearls of Portugal is here to help. With an experienced team and a personalized approach, we can help you find the home of your dreams, guide you through every step of the buying or renting process, and navigate the real estate market in Portugal in 2024.

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