All the details about the cheapest and most expensive property in Portugal and how inflation is infecting the market.
Portugal house prices 2022
Portugal house prices 2022 micheile dot com on Unsplash

Inflation is contaminating all markets - and real estate is no exception. Data from the National Statistics Institute (INE) show proof, stating that houses were 13.2% more expensive in the first quarter of 2022 compared to the previous year. This is the biggest increase ever recorded by the institute, and buying a house in Portugal began to cost, on average, 190,054 euros between April and June (+2% than at the beginning of the year). How much does it cost to buy a house in each Portuguese region? And how have prices evolved? We explain everything.

Portuguese property market in 2022

In Portugal, buying a house is still proving to be a popular option. Between April and June alone, 43,607 homes were sold in Portugal, 4.5% more than in the second quarter of 2021. And this dynamic in the business of houses moved 8.3 billion euros, 19.5% more compared to the value recorded in the same quarter of 2021. All told, a house in Portugal began to cost, on average, 190,054 euros in the second quarter. In the second quarter of 2021, houses cost much less: 166,116 euros, on average.

After the country recovered from the initial shock of the pandemic, business has started to flow again. And house prices have been rising quarter after quarter since the end of 2020. Homes in Portugal now cost, on average, 22% more than in the second quarter of 2020 and 29% more than before the pandemic (April and June 2019), the data show.

Of note, the accelerating home sales and rising average house prices nationwide in 2022 take place in a complex macroeconomic context marked by war, high inflation and rising interest rates on home loans, which are making mortgage payments more expensive. 

Average house price evolution in Portugal since 2019

The following graph shows the total amount of money invested in property in euros (green), the number of houses purchased (grey) and the average property price in euros (purple).

Home purchases
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How much does it cost to buy a house in each region of the country?

Looking at each region of the country it is apparent that the average house prices vary greatly from territory to territory. It is in the Algarve where buying a house was the most expensive in the second quarter of 2022, costing an average of 287,482 euros. And right after is the Metropolitan Area of Lisbon, with house prices reaching 260,754 euros. On the other hand, it is in the Alentejo and the Central regions where it is cheapest to buy a house.

The evolution of prices over the years is not homogeneous either. Compared to the previous quarter (1st quarter of 2022), Portuguese property became more expensive in 6 regions of the country. And the most significant was registered in the Algarve of 6%. In the Metropolitan Area of Porto and in the Autonomous Region of the Azores, prices fell slightly.

In relation to the second quarter of 2021, properties in Portugal were more expensive in all regions of the country. The largest increase in house prices was felt in the Autonomous Region of Madeira (+21%): here a property cost, on average, 170,763 euros between April and June last year and came to cost 206,607 euros (+35.8 thousand euros) in the same period of 2022. Also in the Algarve and the Azores, prices jumped by 20% and 19%, INE data shows. In the remaining regions, increases of between 12% and 16% were observed.

If we compare current house prices with those before the pandemic (in the second quarter of 2019), the differences are even greater. House prices, in average terms, rose in all regions, with the Autonomous Region of Madeira registering a 49% rise, the highest of all, followed by the Algarve (+45%). In this period, house prices in Lisbon rose 32%: before, buying a house in Greater Lisbon cost, on average, 197,628 euros and now costs 260,754 euros (+63 thousand euros). Also in Porto, homes became 31% more expensive, as prices went from 138,852 euros to 182,411 euros (+43.6 thousand euros). The smallest rise in average house prices was recorded in the Central region - and still it was 22%.

House price evolution in Portuguese regions

Average house prices
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