Authored by the expert who managed and guided the team behind the Portugal Property Pack
Yes, the analysis of Lisbon's property market is included in our pack
Buying property in Lisbon has become significantly more expensive but remains relatively safe from both investment and legal perspectives.
Property prices have nearly doubled since 2020, reaching €5,642–€6,832 per square meter as of September 2025, while the market shows strong stability and foreign ownership protection. However, buyers face substantial additional costs of 6–9% of purchase price and must navigate strict new short-term rental regulations that could impact investment returns.
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 property prices have surged 60-100% since 2020, with current averages of €5,642–€6,832/m² making affordability a key concern for buyers.
The market remains legally secure for foreigners with strong property rights protection, though buyers should budget an additional 6-9% for taxes and fees beyond the purchase price.
| Safety Factor | Risk Level | Key Details |
|---|---|---|
| Legal Security for Foreigners | Very Low | No nationality restrictions, strong property rights protection |
| Market Stability | Low | Robust growth over past decade, 7-8% annual growth in 2025 |
| Price Volatility | Medium | Prices doubled since 2020, affordability concerns emerging |
| Additional Costs | Medium | 6-9% of purchase price in taxes, fees, and registration costs |
| Rental Yield Potential | Low | 4.9-5.5% gross yields, comparable to other EU capitals |
| Renovation Risks (Old Properties) | Medium-High | Hidden structural, plumbing, electrical issues common |
| Short-term Rental Restrictions | High | New AL licenses suspended in central zones since 2024 |
How much do properties in Lisbon actually cost per square meter right now compared to five years ago?
Property prices in Lisbon have experienced dramatic growth, nearly doubling since 2020.
As of September 2025, the average property price per square meter in Lisbon ranges between €5,642 and €6,832. Prime neighborhoods like Avenida da Liberdade, Chiado, and Príncipe Real frequently exceed €6,000/m², with luxury new-build developments reaching €10,000–€12,000/m².
Five years ago in 2020, the average price ranged from €3,000 to €3,500/m², with emerging neighborhoods even lower. This represents an increase of approximately 60–100% depending on the specific area and property type. Central and luxury areas have seen the most significant appreciation, while peripheral neighborhoods have experienced more moderate but still substantial growth.
The rapid price appreciation has created affordability challenges for both local buyers and international investors. Despite this growth, Lisbon property prices remain below those of other major European capitals like Paris, London, or Amsterdam.
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Which neighborhoods in Lisbon are considered the safest for families, professionals, and retirees, and how do crime rates differ between them?
Several Lisbon neighborhoods consistently rank as the safest options for different buyer profiles.
For families and professionals, Estrela, Areeiro, Alvalade, Campo de Ourique, and Parque das Nações are among the most recommended areas. These neighborhoods feature low crime rates, strong community engagement, good schools, and excellent public transportation connections. Parque das Nações, in particular, offers modern infrastructure and family-friendly amenities.
For retirees, Cascais (technically outside Lisbon proper but part of the greater metropolitan area) is widely regarded as the safest and most peaceful option. It combines coastal living with easy access to Lisbon via train, lower crime rates, and a strong expat community.
Crime rate differences are notable between areas. The safest neighborhoods mentioned above experience primarily minor property crimes like bicycle theft or occasional pickpocketing. Central and historic tourist areas tend to have higher rates of petty crime, particularly pickpocketing and tourist-targeted scams, but violent crime remains low throughout Lisbon.
Overall, Lisbon maintains one of the lowest violent crime rates among European capitals, making personal safety less of a concern than property-related crimes in most areas.
What are the typical additional costs when buying in Lisbon, like taxes, notary fees, and agency commissions, and how much do they add up to on average?
Buying property in Lisbon involves several mandatory additional costs that buyers must budget beyond the purchase price.
| Cost Type | Percentage/Amount | Details |
|---|---|---|
| IMT (Property Transfer Tax) | 1%–8% | Progressive scale based on property value and buyer status |
| Stamp Duty | 0.8% | Applied to the property purchase price |
| Notary & Registration | €1,000–€2,000 | Fixed costs for deed preparation and property registration |
| Legal Fees | 1%–2% | Recommended lawyer fees for due diligence and contract review |
| Agency Commission | 3%–5% | If using buyer's agent (seller typically pays seller's agent) |
| Bank Valuation | €300–€500 | Required for mortgage applications |
| Total Additional Costs | 6%–9% | Combined percentage of purchase price |
How stable has the Lisbon property market been in the past decade, and what are the latest trends in price growth or decline?
The Lisbon property market has demonstrated remarkable stability and consistent growth over the past decade.
Since 2014, the market has shown robust price resilience with particularly strong increases beginning in 2016. The growth has been driven by foreign investment, the Golden Visa program, digital nomad influx, and limited housing supply relative to demand. Even during the COVID-19 pandemic, Lisbon property prices remained stable and continued growing.
As of September 2025, the annual growth rate remains positive at 7–8%, though this represents a slight moderation from the double-digit growth rates seen in previous years. Prices are currently at record highs, creating increasing affordability concerns for local buyers.
Recent trends indicate that while price growth continues, the rate of appreciation is slowing as the market approaches price ceilings that strain buyer affordability. Luxury and prime central properties continue to see strong demand, while peripheral areas show more moderate but steady growth.
Market experts predict continued but slower growth in 2025-2026, with potential for some price corrections in overheated segments if interest rates remain elevated or if new supply significantly increases.
What are the risks of buying older apartments in Lisbon, especially regarding hidden renovation costs, structural issues, or compliance with building codes?
Older apartments in Lisbon present significant risks that require careful evaluation before purchase.
Hidden renovation costs are among the most common issues. Many buildings constructed before modern standards conceal problems like failing plumbing systems, outdated electrical wiring that doesn't meet current safety codes, insufficient insulation leading to high energy costs, and hidden dampness or structural problems requiring major renovation work.
Structural issues frequently include foundation problems, aging building facades, roof leaks, and deteriorating common areas that require expensive collective repairs through the condominium. Some older buildings lack proper earthquake retrofitting, which may be required for safety compliance.
Building code compliance presents another risk area. Properties built before current regulations may lack proper documentation, energy efficiency certificates, or required permits for previous modifications. Bringing these properties up to current standards can involve substantial unexpected costs.
Due diligence steps include conducting thorough structural surveys, reviewing condominium financial statements for planned major repairs, checking building permits and legal documentation, and budgeting 15-25% above purchase price for potential renovation needs.
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How secure is property ownership for foreigners in Portugal, and are there any common legal pitfalls or disputes buyers face in Lisbon?
Property ownership security for foreigners in Portugal is exceptionally strong with robust legal protections.
Portugal's legal system provides the same property rights to foreigners as to Portuguese citizens, with no nationality restrictions on property ownership. The country's EU membership and stable legal framework offer additional protection for international buyers. Property rights are well-established and enforced through an efficient court system.
Common legal pitfalls include unclear property boundaries, particularly in older buildings where property lines may not be precisely documented. Lack of proper due diligence on building permits and legality can create issues, especially for properties with unauthorized modifications or extensions.
Outstanding debts on properties represent another risk area. Buyers may inherit condominium debts, unpaid property taxes, or utility bills if proper verification isn't conducted. Some properties carry liens or encumbrances that aren't immediately apparent without thorough legal review.
To avoid disputes, engaging a qualified Portuguese lawyer is highly recommended for all property transactions. Legal fees typically range from 1-2% of purchase price but provide essential protection against costly mistakes and ensure proper title transfer.
What's the average rental yield in Lisbon today, and how does it compare with other European capitals?
Lisbon's rental yields remain competitive within the European context, though they've declined as property prices have risen faster than rents.
The average gross rental yield for apartments in Lisbon currently ranges from 4.9% to 5.5%, depending on location and property type. Central areas typically offer lower yields (4.5-5%) due to higher property prices, while emerging neighborhoods and peripheral areas can achieve yields above 5.5%.
Compared to other European capitals, Lisbon performs favorably. Madrid and Barcelona average 4-5%, Paris yields 3-4%, London provides 3.5-4.5%, and Berlin offers 4-5%. Amsterdam and Copenhagen typically yield 3.5-4.5%. Lisbon's yields are on par or slightly above most Western European capitals.
Higher yields tend to occur in up-and-coming neighborhoods like Marvila, Alcântara, and parts of Benfica, where property prices haven't risen as dramatically as in prime central areas. However, these areas may require more management and carry higher vacancy risks.
Net yields after taxes, management, and maintenance costs typically range from 3.5% to 4.5%, making Lisbon competitive for rental investment compared to other major European cities.
How long does it usually take to resell a property in Lisbon, and what are the typical resale gains or losses?
Property resale timeframes in Lisbon vary significantly based on property type, location, and pricing strategy.
Average resale time ranges from 3 to 9 months, with well-priced properties in desirable neighborhoods selling faster than overpriced or problematic properties. Prime central locations and modern apartments typically sell within 3-6 months, while older properties or those in less desirable areas may take 6-12 months or longer.
Properties purchased 5+ years ago have generally seen substantial gains of 40-80%, particularly those bought before the major price increases that began around 2016-2017. Buyers who purchased in 2020 or earlier have typically seen gains of 60-100%, reflecting the dramatic price appreciation.
However, future upside potential may be more limited as prices have reached levels that strain affordability. Properties purchased in 2023-2024 at peak prices may see more modest gains or even temporary losses if market corrections occur.
Resale success factors include proper pricing based on current market conditions, property condition and presentation, and timing with market cycles. Properties that require significant renovation or have legal issues typically experience longer sale periods and potentially reduced final sale prices.
Are there any upcoming urban development projects, infrastructure changes, or zoning laws in Lisbon that could positively or negatively affect property values?
Several major urban development and infrastructure projects are reshaping Lisbon's property landscape with significant implications for property values.
Positive developments include the Riverside Tech District project, which aims to create a major technology hub along the Tagus River. New Metro expansions are planned to improve connectivity to currently underserved areas. Urban regeneration projects in Marvila and Alcântara are transforming these former industrial areas into mixed-use neighborhoods with modern amenities.
The Lisbon Green Capital initiative includes extensive urban forest projects, improved cycling infrastructure, and sustainable transportation improvements that should enhance livability and property values in affected areas.
Potential negative factors include stricter zoning regulations in central areas aimed at controlling tourism density and protecting residential character. New short-term rental licensing restrictions have already been implemented in central zones, which impacts investment returns for properties previously used for Airbnb.
Urban density controls may limit future development in some prime areas, potentially supporting existing property values through supply constraints but limiting new construction opportunities.
The overall impact trends positive for property values, particularly in neighborhoods benefiting from infrastructure improvements and urban regeneration projects.
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 safe is it to buy property in Lisbon off-plan or in new developments, and what protections exist if the project gets delayed or canceled?
Buying off-plan property in Lisbon carries moderate risks that can be managed through proper legal protections and developer selection.
Portuguese law provides several important protections for off-plan buyers. Developers must place buyer deposits in escrow accounts or provide bank guarantees to protect funds until completion. Payments are typically structured in stages tied to construction milestones, limiting buyer exposure.
Risks include construction delays, which are common in the current environment due to material shortages and labor constraints. Developer bankruptcy or financial difficulties can result in project cancellation, though legal protections should recover most buyer funds. Quality issues or specification changes from original plans can occur.
Before committing to off-plan purchases, ensure the developer has all required permits and licenses, check the developer's financial stability and track record, verify that deposit protection mechanisms are in place, and review construction timelines and penalty clauses for delays.
Established developers with multiple completed projects generally present lower risks than new or unknown companies. Projects in prime locations with strong pre-sales typically have better completion prospects than speculative developments in emerging areas.
Legal review by a Portuguese property lawyer is essential for off-plan purchases to ensure proper protection and contract terms.
What's the current situation with short-term rentals in Lisbon, including restrictions on Airbnb, licensing rules, and their impact on property values?
Short-term rental regulations in Lisbon have undergone major changes that significantly impact property investment strategies.
As of 2024-2025, new AL (Alojamento Local) short-term rental licenses are suspended in central Lisbon zones, effectively preventing new Airbnb operations in prime tourist areas. Existing licenses are grandfathered and can continue operating, but may face future regulatory tightening.
Current AL license holders must comply with strict rules including proper registration, tax payments, safety requirements, and neighbor notification procedures. Violations can result in license revocation and substantial fines.
The licensing suspension has created a two-tier market where properties with existing licenses command premium prices, while those without licenses must rely solely on long-term rental income. This has partially cooled demand for smaller central apartments previously targeted by Airbnb investors.
Impact on property values varies by location. Central tourist areas have seen some demand reduction for investment properties, though scarcity of licensed properties supports values for those with valid permits. Residential neighborhoods less affected by tourism continue to see steady demand for both purchase and long-term rental.
Future regulatory changes may further restrict short-term rentals, making compliance and license validity critical factors for investment property purchases.
It's something we develop in our Portugal property pack.
How much does it typically cost per year to maintain and manage a property in Lisbon, including condominium fees, insurance, and property taxes?
Annual property ownership costs in Lisbon vary significantly based on property type, location, and building amenities.
Condominium fees represent the largest ongoing expense, typically ranging from €50–€200 per month for standard apartments. Luxury buildings with amenities like pools, gyms, or 24-hour security can cost €300+ monthly. These fees cover building maintenance, common area utilities, insurance, and professional management.
Property tax (IMI) ranges from 0.3% to 0.45% of the property's tax valuation, which is usually significantly below market value. For a €500,000 apartment, annual IMI typically ranges from €600–€1,200.
Property insurance costs approximately €200–€400 per year for typical apartments, covering fire, water damage, and third-party liability. Comprehensive coverage including contents and temporary accommodation costs more.
Additional costs include annual energy efficiency certificate renewals (€150–€300), occasional special assessments for major building repairs, utility connections and deposits for new properties, and property management fees if using rental management services.
Total annual maintenance and ownership expenses typically range from €1,500–€3,500 for standard properties, though larger or luxury properties may incur significantly higher costs. Investors should budget approximately 1.5-2% of property value annually for total ownership costs.
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.
Buying property in Lisbon presents a relatively safe investment opportunity with strong legal protections for foreign buyers, though significant price increases have created affordability challenges.
Success requires careful due diligence, proper budgeting for additional costs, and understanding of new regulations affecting short-term rentals and urban development plans.
Sources
- InvestRopa Lisbon Price Forecasts
- DRP Advisers Portugal Real Estate Market Report
- Mono Estate 2025 Lisbon Property Market Guide
- Global Citizen Solutions Portugal Real Estate Market
- ISS Relocations Best Lisbon Neighborhoods
- Expat Service Best Neighborhoods Lisbon 2025
- Portugal Buyers Agent Living in Lisbon
- Idealista Best Places to Retire in Portugal
- Taxes for Expats Best Places to Live in Portugal
- Reddit Portugal Expats Real Estate Market Discussion