The state of real estate: 2024 property trends in Portugal

By Michael Bruxo
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Property associations in Portugal are predicting continued growth for 2024 as foreigners continue to look to Portugal as a top choice to invest and live in.

With Portugal reportedly among the most sought-after destinations for property investment in 2024, the Resident contacted associations representing the property sector to find out if the outlook for this year is one of optimism.

The Portuguese Association of Residential Tourism and Resorts (APR) has “robust expectations” for 2024, based on the “continuous growth” observed in recent years.

While the country has historically welcomed investors from European markets such as the United Kingdom, France, Germany and the Netherlands, as well as China and other Asian countries, Portugal is seeing “growing interest from countries such as Brazil, the United States, Canada and even Middle Eastern countries”, thanks to its “quality of life, safety, mild climate and rich culture”, APR’s managing director Pedro Fontainhas told the Resident.

Portugal’s strategic position

As he explained, “Portugal’s strategic position as a gateway to Europe” has “significant appeal”.

“The common language and historical ties attract Brazilians, while the diversity and accessible European lifestyle catch the attention of Americans and Canadians. Middle Eastern nationalities value stability and security, as well as investment opportunities,” the APR managing director said.

The growth of the American market has been “particularly significant, driven by the pursuit of superior quality of life, safety, and the attractive real estate investment opportunities that Portugal offers.

“The American market is strategic, as American investors seek to diversify their portfolios and are attracted to the European culture and lifestyle that Portugal provides,” Fontainhas stated, adding that APR is committed to strengthening its relationship with this market by “developing targeted marketing and communication strategies and facilitating the investment and relocation process to Portugal”.

According to APR, Portugal stands out for its “innovation, exclusivity, and cultural richness, attracting those seeking to diversify lifestyles and investments. The vibrant urban scene, architecture blending tradition with modernity, sophisticated coworking spaces, dynamic cultural and gastronomic life, idyllic beaches, and world-renowned golf courses have consolidated Portugal as a leading destination.”

Portuguese resorts in particular “excel in internationally recognised architecture, concierge services offering personalised experiences, luxury amenities, and cultural programs that value local heritage, emphasising sustainability and well-being,” he added.

The Portuguese Association of Property Mediators (ASMIP) is also forecasting a year of growth for 2024, despite Portugal’s well-documented “lack of housing” which will keep prices high.

“After the high demand from the Chinese market, driven by the residency permits provided by the Golden Visa scheme, we are now witnessing great interest from European countries, especially from France and Germany, and to a lesser extent from the UK,” ASMIP vice-president Francisco Bacelar told the Resident.

Outside of Europe, American and Brazilian buyers stand out as those most interested in Portuguese properties.

The American market, in particular, is of “enormous importance” as it has “high financial capacity”, which contributes “significantly to the property sector in the country” and which consequently has a positive domino effect on the construction sector.

As ASMIP points out, American buyers prefer “higher-value properties and good locations”, allowing owners to sell properties which most Portuguese buyers do not have the financial means to acquire.

Investors eyeing March election results

In terms of the investment market (buying properties as an investment as opposed to as a place to live), which “despite some recent decline remains quite active”, ASMIP is expecting it to be “revitalised” once interest rates decrease and demand increases, “creating better conditions for financial return” for this type of investors.

However, Portugal’s upcoming election may play a key role in whether property investors will look to other countries.

“To attract this capital, it will be very important that the results of the March 10 election promote some legislative stability, without which these investors may seek other destinations,” explained Francisco Bacelar.

Lisbon, Porto and Algarve among preferred destinations

Both APR and ASMIP have singled out Lisbon, Porto and the Algarve as the leading areas that attract the most interest among property buyers.

Explained APR, Lisbon stands out for its “vibrant cultural and economic life, with a mix of historic properties and new developments,” while Porto is recognised for its “rich history and cultural scene.” Further south, the Algarve region, famous for its beaches, golf courses and mild climate, is preferred for “holiday properties and retirement residences”.

But these are not the only areas that interest property buyers. According to APR, there is growing interest in areas offering “quiet lifestyles” and “direct contact with nature” in regions such as the Alentejo and areas in the interior of Central and Northern Portugal, particularly “large rural properties or rural tourism opportunities.”

APR clarified that part of its job is to guide investors of any nationality to the sources of information they need about geographical regions, tourist-residential real estate offerings, and legal and tax aspects related to investment and residence in Portugal.

Meanwhile, ASMIP added Braga as another destination that is attracting growing interest, particularly among Brazilians.

“Located 60kms away from Porto, it is also just an hour away from the Francisco Sá Carneiro airport. It provides the experience of living in a ‘small’ city with all the inherent advantages whilst still being very close to everything that the largest cities offer,” explained Francisco Bacelar.

“In this post-pandemic period, there is greater interest in buying (properties) outside the major city centres, both from Portuguese and foreigners. The trend is naturally influenced by the negative experience of lockdowns, which led to a greater need for fresh air and privacy, with more and more projects being rethought because of this,” the ASMIP vice-president said.

He added that this trend is also growing due to the general acceptance of remote work, which “requires fewer daily commutes”, and due to Portugal’s “excellent road network in terms of highways,” making everything feel “very close, no matter where you are.”

Photo: Shutterstock: IACOMINO FRIMAGES