Luxury Real Estate in Portugal: Sales Growth in Q1 2025

Interest in luxury real estate in Portugal remains stable, especially in central Algarve locations such as Quinta do Lago and Vale do Lobo, according to Quinta Property. In Q1 2025, the agency’s sales increased by 10% compared to the same period in 2024.

January and February saw the most activity, while March slowed down due to poor weather, yet the quarter’s overall result remained positive. Demand was strongest in the up-to-€1.5 million segment. Higher-end properties are selling more slowly, though interest in ultra-luxury homes persists. There is a notable shortage of quality listings in the €5–7 million range in Quinta do Lago and Vale do Lobo.

According to The Portugal News, luxury sales across the Algarve rose by 30.4% in the first half of the year. The average transaction price was around €2 million, reaching up to €5 million in prime areas.

The buyer profile is shifting: more clients are coming from the U.S., UK, and Ireland, many of whom are first-time buyers making offers within days of inquiry. Key priorities include well-developed infrastructure and access to international schools—areas like Vilamoura, Lagos, and Tavira are in demand.

Sellers are also becoming more active, driven by lifestyle changes, the end of Portugal's NHR tax program, or plans to return home. Many remain in the Algarve, purchasing more suitable properties. The region continues to attract long-term tenants, with rental demand rising significantly for quality homes.

Real estate prices in Portugal rose by 9.1% in 2024, with the number of transactions up by 15.2%, totaling 134,540. Institutional investors accounted for 21,785 purchases (+10.3%) valued at €5.1 billion (+13.1%).

According to Eurostat, in Q1 2025, Portugal had the highest house price index growth in the EU at 16.3%. For comparison, the eurozone average was 5.4%, and the EU average 5.7%. Bulgaria followed with +15.1% and Croatia with +13.1%.

Roca Estate estimates the median price in April 2025 reached €1,866/m², up 16.9% YoY. Apartment prices rose by 19% to €2,105/m², and in Lisbon and Algarve, prices exceeded €2,800 and €2,480 respectively. House prices increased by 11%. In Madeira, apartment prices jumped 24.5%, while in Alentejo, villa prices dropped 1.7% compared to March, indicating regional imbalances and investment risks.

Geopolitical tension, UK tax reforms, and U.S. economic uncertainty are pushing wealthy buyers toward stable jurisdictions. Portugal is viewed as safe and welcoming, with good climate, infrastructure, and healthcare. New direct flights, including Newark–Faro, have also made Algarve more accessible to U.S. clients.

Investors should note that Portugal's golden visa program has changed—residency is no longer granted through property purchases. Only alternative investments such as funds, research, culture, or business are eligible.

According to Investropa, housing prices in Portugal are expected to rise moderately: 10–12% in 2025, slowing to 6–8% in 2026. Demand will remain high in Algarve, Porto, and Lisbon suburbs, while limited supply and easing interest rates could further impact growth.

The luxury segment is expected to remain resilient in H2 2025 and into 2026, with 5–7% price growth in prime Algarve coastal locations.

According to Essential Business, around 800 high-net-worth individuals (HNWIs) are expected to relocate to Portugal in 2025. Many are looking for premium homes as part of their move, focusing on branded residences and sustainable architecture.