The number of homes purchased in Portugal by non-residents, including foreign nationals and Portuguese emigrants, has declined for the third consecutive year. However, despite this downward trend, overseas buyers continue to pay significantly higher prices than residents, in some cases double the average value.
According to the latest data from Portugal’s National Statistics Institute (INE), the shift reflects both changing market dynamics and recent policy reforms.
Fewer purchases by overseas buyers
In 2025, buyers with tax residence outside Portugal purchased 8,471 homes, representing a 13.3% decrease compared to 2024. This marks the third consecutive annual drop in transactions involving non-residents.
Breaking the figures down further:
- Buyers living in another EU country (excluding Portugal) purchased 4,416 homes, down 9.6% year-on-year.
- Buyers residing outside the European Union acquired 4,055 properties, a sharper decline of 17.1% compared to 2024.
This cooling in demand from abroad contrasts with the domestic market. Buyers with tax residence in Portugal (Portuguese nationals and immigrants living in the country) purchased 161,341 homes in 2025, a 10.1% increase compared to the previous year, accounting for 95% of all transactions — the highest share recorded since 2019.
Why is foreign demand slowing?
Several policy changes may help explain the decline in non-resident purchases.
Portugal ended the Golden Visa real estate investment route at the end of 2023 and revoked the long-standing Non-Habitual Resident (NHR) tax regime, replacing it in 2024 with a more restrictive framework.
These measures reduced some of the fiscal and residency incentives that had previously attracted international buyers to the Portuguese property market.
Overseas buyers still pay more — much more
Although transaction numbers are down, foreign buyers continue to purchase more expensive properties than residents.
In 2025, the average transaction value was:
- €234,120 for buyers with tax residence in Portugal
- €335,640 for buyers residing in the European Union
- €470,277 for buyers living outside the EU
This means EU-based buyers paid on average 43% more than residents, while buyers from outside the EU paid roughly double the average price of homes purchased by residents.
These figures suggest that overseas buyers generally have greater purchasing power and tend to focus on higher-value properties.
Where are non-residents buying?
The Algarve remains the top destination for non-resident buyers.
In terms of number of transactions, the regional breakdown was:
- Algarve – 29.7%
- North – 20% (the highest share for this region since 2019)
- Centre – 14.9%
- Greater Lisbon – 12.5%
When considering the total value of transactions, the Algarve’s dominance becomes even clearer, accounting for 42.4% of the total amount invested by non-residents, followed by Greater Lisbon (22.2%) and the North (12.1%).
Compared to 2024, the Algarve and the North increased their share of transactions, while Greater Lisbon saw the most significant decline in both transaction volume and total value.
What does this mean for foreign buyers?
For international investors and lifestyle buyers considering Portugal, the data highlights a changing landscape:
- Incentive-driven demand has cooled.
- The domestic market is increasingly dominant.
- Prime regions like the Algarve continue to attract high-value international purchases.
- Foreign buyers remain concentrated in higher price brackets.
Despite regulatory changes and a decline in overall non-resident transactions, Portugal remains a sought-after destination — particularly for buyers seeking premium coastal or lifestyle properties.
For foreigners already living in Portugal or planning a move, the message is clear: while competition from overseas buyers has eased slightly, prime locations and quality homes continue to command strong prices.
