Amid Portugal’s on-going “housing crisis,” the latest reports say that Portugal recorded the second highest year-on-year house price rise (17.7%) in Europe in the third quarter of 2025. The European Union average was 5.3%, according to Eurostat, the statistical office of the EU.
Prices are highest in the major cities, Lisbon and Porto. The per square meter prices in 2025 in Lisbon were about €5,900, and in Porto around €3,900. Inland prices were much lower, many at €1,500, some under €700 per square meter. Between €3,500 and €4,500 are the likely asking prices in places in the extremely popular Algarve.
Portuguese families are the main overall buyers, but much foreign demand, especially for luxury accommodation, is coming from the United States, Brazil, Britain, France and Germany.
Portugal’s housing crisis is because residents find the cost of purchases or rentals is being far outpaced by wages and the general cost of living. Despite government efforts to increase affordable accommodation, the younger generation in particular are suffering.
The Minister of Infrastructure has just acknowledged that the long-running crisis cannot be resolved ‘overnight’ but claims that a new legislative package will bring purchase prices down and encourage renting.

