According to the housing price index, the fourth quarter of 2025 saw a year-on-year increase of 18.9%, bringing the average annual growth to 17.6%.
This value constitutes an absolute record in the series of the National Institute of Statistics (INE), in a year in which the sector's dynamism was also evident in the volume of business, with sales transactions approaching 170,000 units.
Despite this record appreciation, bank valuation data through February 2026 show the residential market is on a strong trajectory at the start of the new year. However, analysts warn of moderating factors that could halt this price surge in the coming months.
The persistence of the conflict in the Middle East, with its direct effects on household confidence and the reduction of disposable income due to inflationary pressures, emerges as the main element capable of cooling demand and stabilising the national real estate market.
Whether this rise in the CPI persists in the coming months will now depend solely on the evolution of geopolitical developments and the duration of the conflict, which remains the main factor of uncertainty for price stability in Portugal and the Eurozone.
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This increase in house prices driven mainly by investors from abroad, particularly America and the UK are pricing local people out of homes!
I have spoken to people in Olhao and other parts of the Algarve about it and no one was in favour about it.
We had similar things happening in England, in Cornwall a while ago and it just created more resentment, bad feeling, even attacks.
This should not be allowed to continue and it is to the detriment of the Portuguese people. I think the government should put a clamp on it and quick!
By Karen from UK on 18 Apr 2026, 09:54
Karen,
Question: Who do you fault for the asking of such high prices? The immigrants?
Not, it's the Portuguese, and those selling these condos, homes, villas, and property are very happy to get these large sums.
So you would prefer that the government stops people from other countries from buying in Portugal? Or do you propose that price increases be limited by the government, thereby damaging the Portuguese themselves?
Portugal is far from alone in these increases. Most major nations are seeing massive increases.
The Algarve economy is also bases on foreign tourists, which is really what so many Brits and others do here, even if they own a property.
Don't blame the people buying, blame the sellers gouging.
By Mark Dahncke from Algarve on 21 Apr 2026, 02:52