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
What is happening in Lisbon’s real estate market? Are prices soaring or stabilizing? Is Lisbon still a magnet for international buyers? How are local government policies shaping real estate dynamics in 2025?
These are the questions we hear daily from industry experts, potential buyers, and sellers, from the heart of Lisbon to its charming outskirts. You might be curious about these trends too.
We understand this because we maintain close connections with local professionals and individuals like you, exploring the Lisbon real estate scene every day. That’s why we crafted this article: to deliver clear insights, thoughtful analysis, and a comprehensive view of market trends and dynamics.
Our aim is straightforward: to make sure you feel informed and confident about the market without needing to search elsewhere. If you think we missed something or could improve, we’d love to hear your feedback. Feel free to reach out with your thoughts or comments, and we’ll strive to enhance this content for you.
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1) Central Lisbon rents will rise as demand exceeds supply in popular neighborhoods
In 2023 and 2024, Lisbon experienced a significant rise in rental prices, with the average rent for a one-bedroom flat reaching 2,005 euros, making it one of the most expensive cities in Europe. This trend was already evident in 2022 when rents were even higher at 2,200 euros. Such high rental prices indicate a strong demand for housing in central Lisbon.
The influx of tourists and expatriates has further fueled this demand. For example, Airbnb listings in Lisbon were booked at a rate of 17.8% over a 90-day period, showing a strong interest in short-term rentals. This popularity among tourists and expatriates has contributed to the housing demand, especially in popular neighborhoods.
Moreover, the limited availability of new housing developments in these areas exacerbates the housing shortage. In historic neighborhoods, short-term rentals account for more than 20% of housing units, reducing the availability of long-term rentals. Despite government efforts to convert short-term rentals into long-term lets, the program has struggled to attract property owners.
2) Asian investors will increasingly target Lisbon’s real estate, diversifying the buyer demographic
Asian investors are showing growing interest in Lisbon's real estate market, diversifying the buyer demographic.
With over €5 billion more invested by Asia Pacific investors in 2023 compared to 2021, the flow of capital from Asia to Europe is undeniable. This surge is reshaping the landscape of European real estate, with Lisbon emerging as a key player.
Direct flights like Korean Air's new route from Seoul to Lisbon have made it easier for Asian investors to explore opportunities in Portugal. This improved connectivity is a game-changer, making Lisbon more accessible and appealing.
Companies such as Juwai IQI are expanding into Portugal, aiming to connect Asian buyers with local real estate. Their strategic moves simplify the process for investors, making Lisbon an even more attractive option.
Even though Portugal's Golden Visa program has ended, the non-habitual residence scheme still offers significant tax benefits for expats. This has been a major draw for Asian investors seeking favorable conditions.
Lisbon's reputation as a profitable city for real estate investment is growing, with Euronews ranking it as the sixth most profitable city based on rental yields. This media coverage boosts its appeal to international investors.
The rise in property values in Lisbon is another magnet for buyers. In 2023, the average asking price in Lisbon hit €6,009 per square meter, attracting attention from Asian investors looking for lucrative opportunities.
Sources: Savills, Portugal Buyers Agent
We have made this infographic to give you a quick and clear snapshot of the property market in Portugal. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
3) Rising student numbers will increase demand for affordable rentals near universities
The growing student population in Lisbon is a key factor driving the demand for affordable rental properties near universities. In recent years, the number of university students in the Metropolitan Area of Lisbon has been on the rise. For instance, student enrollment increased from 130,629 in the academic year 2019/2020 to 147,066 by 2022/2023.
Additionally, the influx of international students has contributed significantly to this trend. In the academic year 2022/2023, over 74,000 foreign students were enrolled in higher education across Portugal. This increase in student numbers naturally leads to a higher demand for housing, particularly in areas close to universities.
Moreover, there is a reported shortage of student accommodation in Lisbon, which further intensifies the demand for rentals. Students often prefer affordable housing options that are near their universities and city centers, where they can enjoy better amenities. This preference is evident in the popularity of shared apartments in these areas.
Sources: Statista, USAC, European Commission
4) Lisbon's aging population will boost demand for accessible, senior-friendly housing
The average age in Lisbon has climbed from 41.1 years in 2011 to 45 years by 2023, highlighting a growing senior population.
With life expectancy in Portugal now at 81.17 years, and women living even longer, there's a clear need for homes that adapt to aging residents. These homes should include features like easy access and be close to healthcare services.
Government reports are sounding the alarm on the need for senior housing, especially in bustling cities like Lisbon. The demographic shift is putting pressure on the housing market to evolve and offer more options that cater to older residents.
Real estate experts have noted a shortage of senior-friendly properties in Portugal. This gap between supply and demand underscores the urgent need for more accessible housing solutions in Lisbon.
As Lisbon's population ages, the demand for homes that are both accessible and senior-friendly is set to rise. This trend is driven by the increasing number of seniors who need housing that accommodates their lifestyle and health needs.
For potential property buyers, this means an opportunity to invest in a market that is poised for growth. Senior-friendly housing is not just a necessity but a smart investment in a city where the aging population is on the rise.
Sources: Statista, The Portugal News, Savills
5) Lisbon's rental yields will rise as demand from young professionals for rental properties grows
Rental yields in Lisbon are on the rise as more young professionals seek housing in the city.
Lisbon's rental prices have been climbing, with the Idealista Price Index showing an 8.1% increase in house rents in 2023. This surge reflects the city's growing appeal, especially among international talent. Known for its vibrant culture and expanding tech scene, Lisbon ranks 39th in the Mercer Quality of Living City Ranking and 2nd globally for digital nomads, making it a hotspot for young professionals.
There's a noticeable shortage of rental properties in Lisbon. Despite having 320,000 dwellings, about 15% remain empty, limiting rental options. Young professionals prefer renting over buying, driving up demand for short-term rentals. This trend has pushed rental yields to 5.65% by mid-2024 in the Lisbon Metropolitan Area.
The tech and startup boom in Lisbon is attracting young talent, and government incentives for foreign workers and digital nomads are further boosting housing demand. The real estate market is thriving, with an average rental yield of 6.70% across the Lisbon Metropolitan Area, drawing in foreign investors looking for high returns.
Lisbon's appeal is not just about numbers; it's about lifestyle. The city's mix of traditional charm and modern innovation creates a unique environment that young professionals find irresistible. This blend is a key factor in the rising demand for rental properties.
Investors are taking note of these trends, seeing Lisbon as a prime location for real estate investment. The combination of high rental yields and a steady influx of young professionals makes it a promising market.
Sources: Mensagem, Be Global Properties
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6) Lisbon’s property prices will stabilize after rapid growth, creating a more balanced market for investors
Lisbon's property market has been on a rollercoaster, with rapid growth in 2023 and 2024 now showing signs of slowing down.
Recent data from Doutor Finances and the Alfredo platform reveal that average housing prices in Portugal stabilized in early 2024. While Lisbon remains the priciest area, its growth rate is easing, hinting at a market that's finding its balance.
Adding to this, the Lisbon City Council has greenlit a massive real estate project worth 2 billion euros. This development will bring about 2,000 new homes, potentially easing the supply-demand tension and helping to stabilize prices.
On the economic front, forecasts suggest that Portugal's economy will see stable or moderate growth. The property market is expected to grow by another 5% by 2025, supported by strong market fundamentals and investor liquidity.
As the economy slows and costs rise, buyers are becoming more cautious. This shift is leading to more selective and balanced investment strategies, which could further stabilize the market.
Sources: The Portugal News, The Portugal News, Property Market Index Report Portugal 2024-2025
7) Foreign buyers will keep boosting demand in Lisbon, especially in the luxury market
Foreign buyers have consistently shown interest in Lisbon's real estate market, particularly in the luxury segment. In 2023, they purchased 770 residential buildings or apartments, amounting to a turnover of €442.9 million in just the first half of the year. This trend continued into 2024, with 800 properties bought for €464 million, indicating stable investment levels.
The luxury property market in Lisbon is particularly attractive to foreign buyers. In the district of Sto. Antonio, known for its high-end properties, foreign buyers have been active, with prices per square meter reaching 7,393 euros. This shows a clear preference for premium segments among international investors.
Foreign buyers tend to spend significantly more than local buyers. The average transaction value for non-resident buyers is 95% higher than for resident buyers. Specifically, buyers from outside the European Union have an average transaction value of €414,000, which is 143% above the average for local buyers.
Sources: The Portugal News, The Portugal News, The Portugal News
8) Virtual reality tours will become more popular, enabling remote property viewings for buyers
Virtual reality tours are now a staple in real estate, especially since 2023.
Buyers are increasingly opting for virtual tours before seeing properties in person. A past Google survey revealed that 67% of participants preferred listings with virtual tours. This trend is reshaping how people explore potential homes.
Thanks to advancements in VR technology, these tours are now more accessible and affordable. The virtual tourism market saw a jump from $10.52 billion in 2023 to $12.38 billion in 2024, spurred by these tech improvements. Real estate companies are investing more in VR platforms, making virtual property viewing a richer experience.
Real estate agencies are noticing higher engagement through virtual tours. For instance, Tagus Property uses 360° virtual tours and live guided tours to boost buyer and seller interaction. This approach is particularly appealing to international buyers.
In Portugal, Savills reports that foreign clients account for a significant portion of transactions, thanks to these virtual tours. This method is proving effective in attracting a global clientele.
As VR technology continues to evolve, expect virtual tours to become even more immersive and widespread, changing the way we buy properties.
Sources: Tagus Property, Savills Portugal, Momentum Virtual Tours, GlobeNewswire
We made this infographic to show you how property prices in Portugal compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
9) The Golden Visa program will draw more non-EU investors, increasing demand for luxury properties
The Golden Visa program has been a major catalyst for investment in Portugal, especially in real estate.
In 2023, the program attracted over €70 million in investments, with much of it going into real estate. Even after the real estate route ended, investors found new avenues like venture capital and investment funds. This shift shows how adaptable and appealing the program remains.
Lisbon's property market is booming, with house prices rising by 4.7% in the second quarter of 2024. Luxury properties are particularly hot, with prices ranging from €6,324 to €8,117 per square meter. The city's charm is pulling in digital nomads and expat families, driving up demand for high-end homes.
Media buzz and government reports have spotlighted Lisbon as a top spot for luxury investments. Thanks to the Golden Visa, foreign direct investment hit €1.85 billion by September 2024. This has made Lisbon a leader in luxury property price hikes, outpacing many global cities.
Real estate agents are seeing more interest from non-EU buyers, drawn by the Golden Visa's flexibility and Lisbon's stable culture and economy. This is pushing property prices higher and showing the success of Golden Visa holders in the luxury market. The program's impact is clear in the growth of foreign direct investment and Lisbon's property market.
Sources: Global Citizen Solutions, Idealista.pt, Beglobalproperties.com, IMI Daily, Schengen.News
10) Campo de Ourique will grow in appeal with its village charm and recent urban renewal projects
Campo de Ourique has become increasingly desirable due to its unique village-like atmosphere and recent urban renewal projects. This neighborhood in Lisbon has seen a significant rise in property prices, with the average market price per square meter reaching between 6,500 – 7,000 euros. This increase reflects the growing demand for both buying and renting properties in the area.
The district has also experienced a surge in real estate transactions, with properties moving quickly. For instance, there have been cases where promissory contracts were signed, and an apartment was sold within just ten days. This rapid activity indicates a high level of interest and investment in the area.
Urban renewal projects have played a crucial role in enhancing Campo de Ourique's appeal. Mello RDC has invested in several projects, such as the redevelopment of Vila Ourique into modern apartments for young people and the renovation of Vintage Lapa. Additionally, the São Ciro19 condominium, set to start construction, will offer 14 apartments, an underground garage, and a private garden with a pool.
Sources: The Portugal News, Coldwell Banker, The Portugal News
11) Beato will draw more investors as it becomes a tech hub with new innovation centers
In recent years, Beato has become a focal point for investors, especially as it transforms into a tech hub. The development of innovation centers like the Hub Criativo do Beato has played a significant role in this transformation. This project involves extensive rehabilitation of a former industrial complex, turning it into a vibrant space for tech companies and startups.
The presence of major tech companies and startups in Beato, such as those participating in the Unicorn Factory Lisboa's Scaling Up Program, highlights the area's growing appeal. This influx of tech businesses is supported by government incentives, which create a favorable business environment and attract more investors. Additionally, media coverage from outlets like LBC Global and Scale Cities has spotlighted Beato as an emerging tech hub, further drawing attention from potential investors.
Moreover, the development of co-working spaces and innovation centers, offering 35,000 square meters of space across 20 buildings, underscores Beato's commitment to fostering a collaborative tech ecosystem. Partnerships between local universities and tech companies, such as the collaboration between Técnico and Carnegie Mellon University, ensure a steady supply of skilled talent, which is crucial for sustaining the area's growth. These factors, combined with urban regeneration projects and demographic shifts bringing in young professionals, make Beato an attractive destination for investors.
Sources: CMU Portugal, LBC Global, Unicorn Factory Lisboa, Scale Cities
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12) Stricter building codes will raise new development costs, affecting property prices
Stricter building codes often mean that developers need to use more materials and hire additional labor to meet the new standards. This naturally leads to increased construction costs. For example, in Portugal, the introduction of green incentives, like grants and tax breaks for energy-efficient technologies, has raised the upfront costs of new developments.
Looking back at the past decade, housing prices in Lisbon have seen a significant rise, with a 120% increase between 2012 and 2022. This trend suggests that any regulatory changes, including stricter building codes, could further drive up property prices. In other cities, like New York, similar regulatory changes have led to higher property prices, as the increased construction costs are passed on to consumers.
Real estate market analyses often highlight the correlation between regulatory changes and property price trends. For instance, a recent report by Confidencial Imobiliário noted significant increases in the percentage of gross rental yields on property in Lisbon, indicating that higher construction costs due to stricter building codes could further drive up property prices. Surveys of developers in Lisbon also indicate that they anticipate cost hikes from new building standards, which is evident in the increased average asking price for property in Lisbon, rising to €6,009 per square meter in 2023.
Reports from construction companies in Portugal detail the financial impact of adhering to new codes. The introduction of the SIMPLEX decree law in January 2024, aimed at simplifying town and country planning procedures, may lead to increased costs for developers as they navigate the new regulatory landscape. The Portuguese government's *Mais Habitação* legislative programme, while intended to improve affordability, may also increase the costs associated with new developments, thereby impacting property prices.
Sources: Chambers Practice Guides, Portugal Buyers Agent, Portugal Portfolio
13) Luxury rental yields will dip slightly as more high-end properties enter the market
Lisbon's luxury property market is booming, with more high-end developments expected through 2025.
As these upscale properties flood the market, rental yields are likely to face pressure. When there are more luxury homes than tenants, landlords might need to lower rents to fill vacancies, which can lead to a dip in returns.
Real estate agencies like Quintela e Penalva have noticed a surge in luxury rentals in Lisbon. This means more competition among property owners, who may have to offer better deals or perks to attract renters, potentially reducing their profits.
The Prime Global Rental Index highlights a slowdown in luxury property price growth worldwide, including in Lisbon. When prices stabilize or drop, it suggests that rental yields could also fall, as the chance for high returns shrinks.
In Lisbon, the market is becoming more saturated, and property owners are feeling the heat. They might need to get creative with pricing or incentives to stand out, which can further impact yields.
With more luxury options available, tenants have the upper hand, pushing landlords to adjust their strategies to maintain occupancy and returns.
Sources: The Portugal News, Be Global Properties, The Portugal News
14) Marvila will attract young professionals with its vibrant arts scene and new co-working spaces
In recent years, Marvila has transformed into a vibrant district, attracting young professionals with its dynamic arts scene and innovative co-working spaces. The area is known for its impressive street art murals and rich architectural heritage, which have been revitalized by new cultural movements. This creative atmosphere is further enhanced by venues like the Underdogs art gallery and Fábrica Braço de Prata, a former factory turned cultural center.
Marvila's appeal to young professionals is also driven by the growth of co-working spaces. The district hosts the largest co-working space in Europe, Hub Criativo do Beato, which has become a hub for international companies in technology, innovation, and creative industries. Additionally, new co-working spaces are being developed, such as the one by SITIO.pt, which will accommodate 370 people, offering both private offices and open spaces.
The influx of young professionals is supported by Marvila's burgeoning startup scene and creative industries. The district is home to craft breweries, contemporary art galleries, and alternative design stores, attracting a diverse range of professionals. This growth is complemented by media coverage that likens Marvila to New York’s meatpacking district and London’s East End, highlighting its creative urban and industrial flair.
Sources: EduHub Lisbon, Benoit Properties, Coworking Europe
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Portugal. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
15) Luxury property prices in Lisbon may dip slightly as supply catches up with demand
The luxury real estate market in Lisbon has been experiencing a significant increase in the number of high-end residential projects. This rise in luxury developments suggests that the supply of luxury properties is growing, which could lead to a saturation of the market.
Additionally, there has been a noticeable slowdown in the rate of luxury property sales globally. This indicates that demand might not be keeping up with the increasing supply, which could result in sellers adjusting their expectations and prices.
Furthermore, the stabilization of demand for high-end properties is evident from the slowing growth in house prices worldwide. This stabilization could lead to a more balanced market where prices begin to adjust downward.
Sources: Idealista, Benoit Properties, The Portugal News
16) Digital nomads will boost demand for flexible living and co-living spaces
Lisbon is becoming a hotspot for digital nomads, with a surge in D7 Visa applications in 2024.
In 2023, the city welcomed over 16,000 digital nomads, according to Nomad List. This influx is driving up the demand for flexible living arrangements, as these remote workers often prefer short-term rentals that suit their on-the-go lifestyle.
Co-living spaces are gaining traction, offering fully furnished apartments or rooms with shared amenities like gyms and coworking areas. This setup is perfect for digital nomads who appreciate both community and convenience.
These spaces not only provide a place to stay but also foster a sense of community, which is crucial for those who are constantly on the move. The appeal lies in the balance of privacy and social interaction, making it easier for nomads to settle in quickly.
Lisbon's vibrant culture and affordable living costs are additional draws, making it an attractive destination for those seeking a dynamic yet cost-effective lifestyle. The city's infrastructure is adapting to meet the needs of this growing demographic, with more co-living options emerging to cater to their preferences.
As the trend continues, the real estate market in Lisbon is likely to see further changes, with more properties being developed or repurposed to accommodate the unique needs of digital nomads. This shift is reshaping the urban landscape, offering new opportunities for both investors and residents.
Sources: Regional Development, Black Concrete, Mighty Travels
17) Interest in properties with shared amenities will grow due to the desire for community-oriented living
The desire for community-oriented living is becoming a significant factor in driving interest in properties with shared amenities. In recent years, particularly in 2023 and 2024, there has been a noticeable rise in demand for co-living spaces in Lisbon. This demand is expected to reach between 16,000 and 18,000 beds by 2025, highlighting a shift towards more affordable and flexible housing options.
Developers are responding to this trend by investing in residential projects that offer shared amenities. For instance, Smart Studios is transforming an industrial building into a co-living space with 114 studios, complete with shared leisure areas, a library, and a coworking space. These developments cater to young professionals and students who value well-being and cultural interaction.
Consumer surveys have shown that many young people are looking for alternatives to traditional housing due to high property prices. Co-living not only provides financial savings by sharing costs but also offers a sense of community, which is highly valued by residents. The social aspect and flexibility of co-living help individuals better manage their professional lives.
Sources: Supercasa, Iberian Property, Black Concrete
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility. Finally, please note that we are not affiliated to any of the sources provided. Our analysis remains then 100% impartial.