Buying a house cost €1,454/m2 on average in the first quarter of 2022, up 7.3% on the end of 2021, according to INE, the National Statistics in Office in Portugal.
Portugal real estate prices 2022
Portugal real estate prices 2022 Grace Min on Unsplash

Will house prices go down in Portugal? This isn't looking likely, as the current economic context is putting pressure on the purchasing power of those living in Portugal. Inflation jumped 8.7% in June and interest rates on mortgages are rising with the steep rise in Euribor. Buying property is also continuing to become more expensive in Portugal. In the first three months of the year, the price of houses rose 17.2% compared to the same period last year. Accounts made, buying a house in Portugal cost 1,454 euros per square metre (euros/m2), on average, at the beginning of 2022. We have all the details on Portugal house prices in 2022.

Portugal house prices increases in 2022

This is according to the National Statistics Institute in Portugal (INE), which has published an outlook on current house prices in Portugal. The rise in property prices in Portugal in 2022 is accelerating, as the average value of housing calculated for the beginning of 2022 is 7.3% higher than that recorded in the last quarter of 2021, where average prices stood at 1,355 euros/m2. And the year-on-year rate of change in house prices (17.2%) was also higher than that observed at the end of 2021 (14.1%).

The chart below shows average house prices per quarter in Portugal since the start of 2020 in euros, and the year-on-year change of house prices in Portugal (%).

The year-on-year change of property prices in Portugal
The year-on-year change of property prices in Portugal idealista

And who is buying the most expensive houses in Portugal? In the first quarter of the year, it's foreigners who continue to buy more expensive homes than the Portuguese, points out the Portuguese statistics office:

  • Buyers with tax residence abroad: the average house price was 2,209 euros/m2, a lower figure than in the previous quarter, at 2,302 euros/m2;
  • Buyers with tax residence in Portugal: the average house price was 1,428 euros/m2 (in the fourth quarter of 2021 it had been 1,319 euros/m2).

It should also be noted that the average price of properties in Portugal purchased was 1,471 euros/m2 between January and March 2022, a higher value than that recorded in the previous quarter (1,388 euros/m2). Buyers belonging to the remaining institutional sectors, on the other hand, bought houses for the median value of 1,293 euros/m2 (1,097 euros/m2, at the end of 2021).

More expensive property in most sub-regions of Portugal

Property became more expensive in 22 of the 25 sub-regions of the country. It is in the Algarve (2,237 euros/m2) and in the Metropolitan Area of Lisbon (1,986 euros/m2) where the most expensive houses are found in Portugal. And it was also these sub-regions that "presented the highest values in both categories of tax residence of the buyer", highlights INE:

  • Foreigners: the Algarve (2,588 euros/m2) and Greater Lisbon (3,533 euros/m2);
  • Portuguese: the Algarve (€2,115/m2) and Greater Lisbon (€1,969/m2).

Among the sub-regions with the most expensive house prices is the Autonomous Region of Madeira (1,586 euros/m2) and the Metropolitan Area of Porto (1,555 euros/m2), found the institute. These four sub-regions are the only ones that present an average value of housing higher than the national average. On the other hand, the houses with the lowest property prices in Portugal are in Alto Alentejo (500 euros/m2) and in the sub-region of Beira (Central Portugal) and Serra da Estrela (Guarda) (580 euros/m2).

But where did house prices rise the most at the beginning of the year in comparison to the same period last year? It was precisely in Beira and Serra da Estrela (23.7%), followed by Alentejo Litoral (22.1%). The Algarve (22.0%) and the Metropolitan Area of Porto (17.4%) also showed higher year-on-year increases than the national level.

Note also that the houses were cheaper in this period in Alto Alentejo (-5.1%), Lezíria do Tejo (Santarém) (-0.6%) and Beira Baixa (-0.5%), according to the data.

Lisbon continues to be one of the most expensive places to live in Portugal
Lisbon continues to be one of the most expensive places to live in Portugal Alice Kotlyarenko on Unsplash

House prices rise in all municipalities with over 100 thousand inhabitants

House prices in Portugal rose in the 25 municipalities with more than 100 thousand inhabitants between the beginning of the year and the corresponding quarter. The most significant rise was recorded in Vila Nova de Gaia, up 20%, followed by Gondomar (+19.8%), Setúbal (+19.4%) and Sintra (+18.5%). The least significant developments in house prices were observed in Matosinhos (+4.5%) and Leiria (4.9%), the data reveals.

Lisbon continues to be the municipality with more than 100 thousand inhabitants where buying a house is the most expensive, reaching the median value of 3,757 euros/m2 in the first three months of 2022. Just behind are Cascais (3,319 euros/m2), Oeiras (2,873 euros/m2) and Porto (2,495 euros/m2).

Barcelos, Santa Maria da Feira and Guimarães are the municipalities in this range where buying property is cheaper, recording prices of 1,008 euros/m2, 1,064 euros/m2 and 1,065 euros/m2, respectively.

"In the first quarter of 2022, all municipalities with more than 100,000 inhabitants in the metropolitan areas of Lisbon and Porto, with the exception of Gondomar and Santa Maria da Feira, recorded average house prices higher than the national value (1,454 euros/m2)," INE highlights.