Portugal: Despite golden visa curbs, foreign buyers fuel housing crisis

Non-EU buyers are paying double for homes in Portugal, fuelling a housing crisis that's pricing out locals and pushing Lisbon to the top of EU unaffordability ranks

Foreigners from outside the European Union are paying nearly twice as much as locals for homes in Portugal, according to new government data, as concerns grow over affordability and displacement in the country’s major cities.

 

Between January and March 2025, non-EU nationals paid an average of €451,000 to buy property in Portugal, while domestic buyers paid €225,000. EU citizens from other countries spent €310,000 on average, the National Statistics Institute reported on its website.

 

Foreign demand and local frustration

 

Portugal has long attracted international residents with its warm weather, relatively low living costs, and tax breaks. The now-curtailed golden visa programme further encouraged this trend by offering residency in exchange for investment. Until 2023, buying property was a popular route under this scheme, especially for nationals from the US, Brazil and China. The minimum threshold for other options such as fund investments remains at €500,000.

 

The rush of foreign interest has contributed to rising home prices across the country, with average prices hitting €2,851 per square metre in May 2025. That’s more than two and a half times the price seen in May 2015, according to property website Idealista.

 

In Lisbon, housing prices have jumped 176 per cent between 2014 and 2024 — and more than 200 per cent in central historic areas. With rent and sale prices surging, many locals say they’ve been priced out of their own neighbourhoods.

 

Portugal now ranks as most unaffordable in EU

 

Lisbon now tops the European Union’s housing unaffordability rankings, based on the home price-to-income ratio. Back in 2015, Portugal ranked 22nd out of 27 EU countries on this measure. Today, it stands at number one.

 

Incomes have not kept pace. Around 60 per cent of Portuguese taxpayers earn under €1,000 a month. Finding a flat in Lisbon at that rent is increasingly rare — unless one is willing to live in 20 square metres or less.

 

Rental costs have also soared:

 

> Rents in Lisbon have gone up 65 per cent since 2015

> Property sale prices have increased 137 per cent in that time

> In 2022 alone, rents jumped 37 per cent — more than in Paris or Barcelona, according to Casafari

 

The housing squeeze has sparked public anger. In 2024, thousands marched in cities across the country to protest unaffordable home prices and rising rents.

 

“Our neighbourhoods are not your business,” read one of the banners. Another said, “I have to choose between paying for a house or eating.”

 

“The housing problem is a problem that has been going on for many years in our country and is now reaching a situation that is beyond unbearable,” a protester in Porto told EuroNews.

 

In Lisbon and Porto, residents have also expressed frustration over the growing number of properties being converted into tourist rentals. The shift, they say, is stripping their cities of local character and pushing essential services and long-term housing out of central areas. Calls for stricter rules on short-term lets and tourist accommodation have been gaining ground.