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Yes, the analysis of Lisbon's property market is included in our pack
The Lisbon property market presents a complex decision for potential buyers in September 2025.
Current apartment prices in central Lisbon average €6,832 per square meter, representing a 30-40% increase from pre-COVID levels, while rental yields hover between 3.9-4.6% for long-term rentals and 4-5.5% for short-term rentals after recent regulatory changes.
If you want to go deeper, you can check our pack of documents related to the real estate market in Portugal, based on reliable facts and data, not opinions or rumors.
Lisbon's property market continues growing at 5-7% annually, but the pace is moderating from previous years' double-digit increases.
Waiting another year could mean paying 10-15% more for the same property, requiring an additional €40,000-€90,000 in cash for typical central apartments.
| Market Factor | Current Status (Sept 2025) | 12-Month Outlook |
|---|---|---|
| Average Price/sqm Central Lisbon | €6,832 | €7,500-€7,850 (+10-15%) |
| Long-term Rental Yield | 3.9-4.6% | 3.5-4.2% (slight decline) |
| Time to Sell | 5-6 months | 4-5 months (improving) |
| Mortgage Rates | 3.0-3.5% | 3.2-4.0% (potential increase) |
| Golden Visa Availability | No longer available for residential | Unlikely to return |
| New Supply | Tightened by 3-4% | Gradual increase expected |
What's the current average price per square meter for apartments in central Lisbon and how has that changed over the last 12 months?
Central Lisbon apartment prices average €6,832 per square meter as of September 2025.
Premium central districts command higher prices, ranging from €7,000 to €12,000 per square meter for luxury or newly constructed properties. The most expensive areas include Chiado, Príncipe Real, and prime waterfront locations.
Over the past 12 months, prices have increased by 5-7% year-on-year. This growth rate represents a moderation from the double-digit price jumps experienced in 2022 and 2023, when annual increases often exceeded 15%.
The price growth remains steady but is slowing compared to previous years. Market observers note that buyer behavior has become more cautious, leading to longer negotiation periods and smaller price premiums.
It's something we develop in our Portugal property pack.
How much higher or lower are today's prices compared to their peak before COVID and their lowest point after?
Current Lisbon apartment prices are significantly higher than both pre-COVID peaks and post-pandemic lows.
Before COVID in late 2019, central Lisbon averaged €4,800-€5,200 per square meter. The post-COVID low point in 2021 saw prices dip to €4,400-€4,600 per square meter in some districts before recovering.
Today's prices of €6,832 per square meter represent a 30-40% increase above pre-COVID peak levels. Compared to the post-COVID low, current prices are at least 45% higher in leading central districts.
This substantial price appreciation reflects Portugal's attractiveness to international buyers, remote workers, and investors during the pandemic recovery period. The combination of low interest rates, lifestyle appeal, and relative affordability compared to other European capitals drove sustained demand.
What's the average rental yield right now in Lisbon for both long-term rentals and short-term Airbnb?
Long-term rental yields in Lisbon currently average 3.9-4.6% gross, varying by location and property size.
| Rental Type | Gross Yield Range | Net Yield (After Costs) |
|---|---|---|
| Long-term Traditional | 3.9-4.6% | 2.5-3.5% |
| Short-term Airbnb (Prime) | 5.5-7.0% | 3.5-5.0% |
| Short-term Airbnb (Average) | 4.0-5.5% | 2.5-4.0% |
| Mixed Strategy | 4.5-5.5% | 3.0-4.0% |
| Student/Corporate Rental | 4.2-5.0% | 3.0-3.8% |
Short-term Airbnb rentals in prime central locations can achieve 5.5-7% gross yields, but most areas now offer 4-5.5% due to increased regulation and competition. Net yields typically run 1.5% lower than gross yields after accounting for management costs, maintenance, and taxes.
How fast are apartments selling on average, and has the time-on-market been getting shorter or longer recently?
Apartments in Lisbon currently take 5-6 months to sell on average, representing an increase from previous years.
Time-on-market has lengthened compared to the market peak in 2023, when properties sold in closer to 3 months. This extension reflects more cautious buyer behavior and increased negotiation periods.
Sellers now offer discounts averaging 8% off initial asking prices to close deals. This represents a shift from the seller's market conditions of 2022-2023, when properties often sold at or above asking price.
The longer selling times indicate a market normalization rather than distress. Buyers have more selection and negotiating power, while sellers must price properties more realistically to attract serious offers.
What's the current supply of new listings compared to this time last year, and is inventory tightening or loosening?
New listing supply has tightened by 3-4% in early 2025, with fewer fresh properties entering the market.
However, overall available listings have increased slightly year-on-year due to slower absorption rates and more resale properties remaining on the market longer. This creates a mixed inventory picture where new construction is limited but existing stock accumulates.
Developers are proceeding more cautiously with new projects, citing construction costs and regulatory uncertainty. The pipeline of new developments for 2026-2027 appears smaller than previous years.
The inventory situation favors buyers in terms of selection and negotiating power, particularly for existing properties. New construction remains competitive due to limited supply and buyer preference for modern amenities.
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How high are mortgage rates in Portugal right now, and what difference would a 1% rise or fall make on monthly payments?
Portuguese mortgage rates currently range from 3.0-3.5% for most borrowers, with some prime buyers accessing rates as low as 2.7-3.0%.
Fixed-rate mortgages are available at 3.5-4.5%, while variable rates track European Central Bank policy rates plus bank margins. International buyers typically pay slightly higher rates than Portuguese residents.
For a €500,000 loan, a 1% rate increase adds approximately €250 per month to payments. Conversely, a 1% rate decrease reduces monthly payments by €215-€265, depending on loan terms and amortization schedule.
Rate sensitivity analysis shows that potential buyers should factor rate volatility into affordability calculations. The European Central Bank's monetary policy significantly influences Portuguese mortgage costs.
What are the most recent forecasts from major banks or agencies for Lisbon property prices in the next 12–24 months?
Major financial institutions and real estate agencies forecast continued price growth of 3-7% annually for Lisbon over the next 12-24 months.
Bank analysts expect new supply to stabilize price increases somewhat, preventing the double-digit growth seen in recent years. However, sustained demand from international buyers and limited central inventory support continued appreciation.
Property prices may be 10-15% higher by September 2026 if current trends continue, with newly built and high-demand areas experiencing the strongest growth. This projection assumes stable economic conditions and no major regulatory changes.
The consensus view suggests moderated but positive price growth, making Lisbon less explosive but still appreciating compared to many other European markets.
It's something we develop in our Portugal property pack.
How much are property taxes, transaction fees, and ongoing ownership costs for a typical Lisbon apartment?
Property acquisition in Lisbon involves several mandatory taxes and fees that buyers must budget for beyond the purchase price.
| Cost Category | Rate/Amount | Example (€400k Property) |
|---|---|---|
| IMT (Transfer Tax) | 0-7.5% (typically 6-8%) | €24,000-€32,000 |
| Stamp Duty | 0.8% | €3,200 |
| Legal/Notary Fees | 1-2% | €4,000-€8,000 |
| Registration/Admin | €500-€2,500 | €1,500 |
| Total Transaction Costs | 8-12% | €32,700-€45,700 |
| Annual IMI Tax | 0.3-0.45% | €1,200-€1,800/year |
| Monthly Condo Fees | €30-€150 | €90/month average |
Ongoing ownership costs include IMI municipal tax at 0.3-0.45% of official property value annually, condominium maintenance fees ranging from €30-€150 monthly (up to €300 for luxury buildings), and utilities plus insurance averaging €100-200 monthly.
What visa or residency advantages, like the Golden Visa or Digital Nomad Visa, are still relevant for property buyers today?
The Golden Visa program no longer provides residency through direct residential real estate purchases as of late 2023.
Current Golden Visa options require investments starting at €280,000-€500,000 in approved funds, research projects, cultural initiatives, or commercial real estate rather than residential properties. This eliminates the primary immigration incentive for many international property buyers.
Alternative visa options remain available for property buyers. The D8 Digital Nomad Visa permits remote workers to live and purchase property in Portugal with proof of sufficient income. The D7 Passive Income Visa serves retirees and those with non-employment income sources.
The new NHR 2.0 tax regime offers attractive taxation benefits for qualifying professionals, though with more restrictions than the previous program. These alternative pathways provide residency options but don't directly tie to property investment amounts.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Portugal versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.
How likely is it that stricter regulations on Airbnb and short-term rentals in Lisbon will reduce rental income potential?
Stricter short-term rental regulations have already been implemented citywide in 2023-2025, creating ongoing uncertainty for rental income potential.
Current restrictions include license caps, designated zones, and additional taxes that limit Airbnb operations. New regulations may further reduce gross yields and operational flexibility, particularly in central tourist districts where enforcement is strictest.
Long-term rental demand remains robust and provides more stable yields without regulatory risk. Many investors are shifting strategies from short-term to long-term rentals to avoid compliance complexities and potential income volatility.
The regulatory trend appears toward continued restrictions rather than relaxation, making short-term rental income projections increasingly uncertain for investment planning purposes.
How does Lisbon's cost per square meter compare to other European capitals like Madrid, Barcelona, or Paris right now?
Lisbon's €6,832 per square meter positions it between other major European capitals in terms of affordability and yield potential.
Madrid averages €4,500-€5,200 per square meter with rental yields of 3.5-5%, making it more affordable than Lisbon but with comparable returns. Barcelona ranges €5,750-€6,200 per square meter with 4-5.5% yields, placing it very close to Lisbon's pricing.
Paris commands €10,200-€13,000 per square meter but offers lower rental yields of 2.5-4%, making it significantly more expensive with inferior returns. This positions Lisbon as a middle-ground option with reasonable acquisition costs and decent yield potential.
Lisbon remains cheaper than Paris but more expensive than Madrid, while offering higher yields than Paris but slightly lower than Spain's prime tourist zones. The city provides a balanced risk-return profile among European capitals.
It's something we develop in our Portugal property pack.
If I wait one more year, how much more cash would I realistically need for the same type of property, given current price and rent trends?
Waiting until September 2026 would likely require 10-15% more cash for the same central Lisbon apartment based on current market trajectories.
For a typical central apartment currently priced at €400,000, buyers would need an additional €40,000-€60,000 by next year. For higher-end properties at €600,000, the additional cash requirement reaches €60,000-€90,000.
Transaction costs would increase proportionally, adding another €3,000-€8,000 to total acquisition expenses. Mortgage payments would also rise due to higher principal amounts, even if interest rates remain stable.
Rental yields may decline slightly if regulation tightens further or rental growth slows, potentially reducing investment returns. The combination of higher purchase prices and stable rental income would compress yield calculations for investment buyers.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Lisbon's property market in September 2025 presents a "buy now" scenario for most buyers willing to enter the market.
With prices continuing to rise at 5-7% annually and potential 10-15% increases over the next year, waiting typically means paying significantly more for the same property while facing possible yield compression from regulatory changes.
Sources
- Tagus Property - Real Estate Market Lisbon
- MonoEstate - 2025 Lisbon Property Market Guide
- Portugal Residency Advisors - Cost of Living in Lisbon
- Global Property Guide - Portugal Rental Yields
- Idealista - Renting in Portugal Lisbon Rankings
- Portugal Buyers Agent - Real Estate Investment Lisbon
- LinkedIn - Lisbon Market Pulse Inventory Analysis
- Property Lisbon - Mortgage Interest Rates Guide
- Belion Partners - Portugal Golden Visa 2025 Changes
- Global Citizen Solutions - Portugal Golden Visa