A new review of Portugal’s real estate market has found no sign of an exodus following changes to the country’s citizenship law and migration rules. The market has neither slowed nor reversed course; instead, it continues to grow and remain active.

The most notable shift is that more people are choosing to buy homes rather than remain in rental accommodation. Demand has not disappeared — it has become more rooted in the domestic market and increasingly focused on homeownership.

What is happening in the market

Portugal continues to face a housing shortage, which is keeping upward pressure on prices.
• Property prices rose by around 17% in 2025.
• Approximately 170,000 transactions were completed, up 8.6%.
• Existing homes remained the main driver of activity.
• Lower mortgage rates, which fell to 2.9%, helped revive demand.

Early 2026

Growth is continuing, although without the sharp increases seen previously.
• Residential property valuations increased from €2,105 to €2,151 per square metre.
• Asking prices rose from €3,047 to €3,121 per square metre.
Housing remains expensive, and in some cases mortgage payments can consume up to half of a household’s income.

Rental and commercial property markets

• The rental market is stabilising and, in some areas, retreating from peak levels.
• Commercial real estate recorded its strongest performance in six years, attracting nearly €1 billion in investment during a single quarter.
• Office space remains scarce, with vacancy rates of around 8% in Lisbon and 5% in Porto.

Regional picture

• Lisbon remains the country’s most expensive market.
• Porto offers a balance between affordability and growth potential.
• Northern Portugal records the highest number of transactions.
• Central Portugal is experiencing the fastest price growth.
• The Algarve continues to attract strong demand from foreign buyers.

The conclusion is that Portugal’s property market is neither overheating nor declining. Instead, it is in a phase of steady, sustainable growth.
The key factors supporting the market are:
• a persistent housing shortage;
• more affordable mortgage financing; and
• a continuing shift from renting to homeownership.