Real estate prices in Portugal continue to rise.

According to the real estate price index published by Idealist, in May, average apartment prices increased in nine capital districts of Portugal. However, prices in Lisbon and Porto remained stable. Various factors, including the impact of inflation on purchasing power and rising mortgage interest rates, contributed to the slowdown in real estate price growth observed in Portugal in recent years. This has likely led to the stabilization of property prices seen in May across many regions of Portugal, with overall figures nearly matching those from April. According to this report, by the end of May, the average property price in Portugal is 2,512 euros per square meter.

Among the nine district capitals in Portugal where an increase in real estate prices was noted, the highest growth occurred in Viana do Castelo (9%), followed by Vila Real (6.6%), Faro (4.1%), and Coimbra (2.8%). Prices remained stable in Lisbon (0.3%), Ponta Delgada (0.1%), Porto (0.1%), and Castelo Branco (–0.3%), while a slight decrease in average housing prices was observed in Portalegre (–2%), Santarém (1.8%), Braga (–1.4%), Aveiro (–1.3%), Guarda (–0.7%), and Beja (–0.7%).

It is important to note, however, that compared to last year, property prices in Portugal have increased by 6.5%. Lisbon and Porto, not surprisingly, remain at the top, with an average property cost of 5,301 euros per square meter.

On the other hand, Portalegre (€705/m²), Guarda (€795/m²), Castelo Branco (€828/m²), Bragança (€891/m²), and Beja (€949/m²) are the most affordable cities in Portugal with the lowest average housing prices in the country. As for the regions, the highest increase in real estate prices was noted in Viana do Castelo (4.1%), on the island of Porto Santo (3.9%), and in Coimbra (3.8%). The regions of Porto (0.4%), Lisbon (0%), and the island of São Miguel (–0.1%) saw price stabilization. The island of Pico (–2%), Braga (–1.1%), the island of Terceira (–0.9%), Aveiro (–0.9%), and Vila Real (–0.6%) reported a decrease in average real estate prices.

While rising inflation and mortgage interest rates, as well as changes in housing legislation, have impacted the increase in housing costs to a certain extent, the demand for real estate, especially in urban centers and tourist areas, still exceeds the current supply. The level of demand from both local and foreign buyers is likely to continue to grow.