Portugal property investment in 2022 / 2023

Find out all about property investment in Portugal in 2022 / 2023!

Why buy a property in Portugal in 2022 / 2023?

Last update of this post: October 04, 2022

The Portuguese property market in 2022

After this period of the pandemic, the property market in Portugal has recovered rapidly in 2021, with a high number of transactions and prices continuing to rise.

House sale prices rose by 13% in the first quarter of 2022, with the highest increase for twelve years, continuing the rise seen between March 2020 and January 2022, with an increase of 27.5%, a record in Europe.

The reason for this increase is the country’s popularity with international buyers, in particular, European and North American buyers looking for a better quality of life, with property prices that remain cheaper than in most major Western metropolises.

While this trend for the country was already present before Covid-19, the pandemic has reinforced this interest.

Lisbon is the city that most attracts these foreign investors, who invested a record 920 million euros in the capital’s properties last year. They accounted for almost 40% of the residential property market. Americans have been the top international buyers in Lisbon for the past two years, choosing the Portuguese capital as their new fashionable destination and overtaking French buyers on the podium, followed by the Chinese and the British.

Contact a Real Estate Agent in Portugal

Title *

Mr Ms.

First name *

Name *

Email *

Phone *

Purpose *

Property purchase Sale of property

Property type *

Mail

Tagus Property processes personal data as part of its commercial relationship with its clients. More.

Madeira Island is the second fastest growing area, followed by the Algarve region, which also grew by at least 10%. Alentejo is the area in Portugal with the “lowest” growth, with an increase (still) of 5%.

Portugal’s assets

10.3 million inhabitants

300 days of sunshine per year

950km of coastline

A stable country

Environment

The Mediterranean climate and its exceptional brightness (300 days of sunshine a year),
The Ocean always close by,
The biological and ecological diversity (surprisingly varied landscapes considering the actual size of the country),
An impressive historic heritage.

Accessibility

Good access to and from the European Union (daily flights from main airports at competitive prices),
Modern infrastructures (very good road network)

Peace of mind

A stable country with one of the lowest crime levels in the world,
Portuguese are welcoming and generally speak some English and French,
A stable political system in the short, medium and long term.

A stable country, inexpensive with an advantageous tax system.

A cost of living among the lowest in the European Union providing a comfortable lifestyle,
A European health system and a European currency,
No major financial risks (exchange rate, inflation, interest rates are all controlled by the European Central Bank),
Facilitated procedures and a totally transparent purchase process for foreign buyers,
An advantageous tax system: no inheritance and donation taxes for Portuguese residents, special exemption regime or reduced income tax for non-habitual residents
Still considered today as a leading and safe investment by many French and British residents,

Real estate opportunities not to be missed!

Holiday destination very attractive to tourists and, consequently, a buoyant holiday home rental and sale market
A very good tourist rental investment potential in the capital.

All these assets contribute to a high quality of life when considering Portugal as a permanent or holiday home location.

The Portugal Property Market in 2022

Location	Average price per sqm
Lisbon Downtown	4 800€
Silver Coast / West Coast	2 200€
Algarve / South Portugal	3 900€

Real estate in Portugal

A property like a house in the south of France but at Portuguese prices. Luxury real estate developments at very competitive prices,
A property equivalent to a house in Spain with in addition the quality of the landscapes and the Portuguese coasts where real estate density has been controlled by the State (which has avoided turning the coasts into concrete jungles and preserves the quality of your property’s environment)
Recognized building quality
Excellent opportunities due to the current lack of market liquidity
Low depreciation risks in the medium and long term; Portugal did not suffer a financial bubble.
A legislation that protects buyers and oversees the market.

At a time of crisis in Portugal, is an investment really appropriate?

Yes, it is precisely in times of crisis that the best opportunities can be found. Indeed, prices are historically low as a result of the ongoing crisis. Taking a long-term approach, Portuguese real estate has never been more attractive. Prices have stabilized since 2002 and strongly declined in 2009, 2010 and 2011.
Real estate prices compared to other European countries are therefore very accessible.

For example, the financial commitment required is a lot less important than for a property investment in France. In addition, a deep-rooted trend has emerged in the present economic conditions: a rise in the demand on the rental market. Because of the difficulties in financing their purchases, the Portuguese rely more and more on rented accommodations, which ensures a good rental level, both in terms of prices and the selection of candidates.

Finally, the Law on the eviction of bad paying tenants has just been updated and is now very favourable to owners, which makes rental investment safe and profitable.

Returns are good compared to some cities such as Paris or London where high square metre prices are capping the average rental returns to approximately 3%.
Lisbon can offer average returns between 5% to 10% for rental apartments for individuals.
In commercial real estate, it is not uncommon to see the return rate climb up to 12%.

The cadastral system is well defined, and the market closely supervised.
It is today impossible to buy a property that does not exist, or which is not declared, without prior knowledge.
Legislation and regulations, in Portugal, on the one hand, and in the EU, on the other hand, allow you to secure your investment.

Portugal therefore has strong long-term assets and you will find excellent opportunities on the market today.

Dynamics of Portuguese real estate market prices

The increase in house prices in Portugal in recent years has been very moderate.

Thus, between 1998 and 2011, house prices in Portugal grew very moderately, unlike other euro area economies.

As early as 2008, Spain and Ireland, frequently compared to Portugal, recorded sharp price falls in the housing market. In contrast, in Portugal, house prices remained relatively stable.

No speculative bubble in Portugal

All the data analysed show that Portugal has not experienced a speculative bubble in the real estate market and value the absence of overvaluation of housing.

The real estate market is therefore quite secure: the absence of overvaluation of housing reduces any future price corrections.

The real estate sector in Portugal therefore represents a solid investment.

Future of the Portuguese real estate market

The current circumstances of the Portuguese economy are favourable to the development of the rental market, the rental law has been reformed making the rental market more dynamic. It has made it possible to simplify and speed up eviction procedures, among other things.

The Portuguese real estate market in a few words

The Portuguese real estate market is characterised by a good quality of supply and relative price stability. It represents a solid investment option, particularly in the residential tourism sector.

FIND A PROPERTY HUNTER IN PORTUGAL BY REGION

MEET THE TEAM

COMPARISON LIST