Why invest in property in Portugal

Do you have questions about investing in real estate in Portugal? Whether you are planning to live there for your retirement or with your family, to work there as a digital nomad or to buy a rental investment, we give you 10 good reasons to invest in Portugal.

Portugal's many assets make it one of the most attractive countries in the Eurozone for investors. Here you will find all you need to know about the Portugal and its property market if you want to invest in a primary residence, a second home or a seasonal rental in Portugal.

The excellent quality of life in Portugal

Most French people who go to Portugal for a holiday or to settle there are attracted first of all by the exceptional quality of life in the country. The pace is more leisurely and daily life is less expensive than in France. The weather is fine and mild. The Portuguese are welcoming and their cuisine is excellent.

The Portuguese way of life attracts tourists from all over the world who come here to enjoy a quiet and friendly holiday. It is also the main reason why many foreigners, especially French, come to start a new professional adventure with their family or to enjoy their retirement.

The Portuguese climate and its geographical location

Portugal's climate is one of the decisive criteria for those who want to invest in real estate, either to settle down or to buy for rent.

Portugal has a Mediterranean climate. The country benefits from an exceptional luminosity with 300 days of sunshine per year. In summer, the proximity of the Atlantic Ocean provides a refreshing breeze. And the winters are sunny and mild.

This explains the constant flow of holiday rentals and the millions of holidaymakers who enjoy the coast or the Portuguese capital every year.

And the regular sunshine makes it possible to take full advantage of renewable energy: solar panels are very profitable in Portugal.

Geographically, the country offers a great variety: large dynamic cities, seaside, peaceful medium-sized cities, mountainous villages, quiet hinterland. Everyone can find the right place for their real estate project.

The ocean runs along 950 km of Portugal with very different landscapes. In the south, the seaside resorts of the Algarve are famous for their endless sandy beaches. Further north, you will find picturesque fishing villages full of charm.

Portugal is a small country in terms of area. It allows you to travel quickly from one place to another and enjoy all its landscapes.

Low cost of living

It is estimated that in 2020 the cost of living in Portugal was 31 % lower than in France. It is one of the countries in the Eurozone that offers both low living costs and quality amenities. In particular, the health system is of good quality. And because Portugal belongs to the European Union, there is no more financial risk than elsewhere in Europe.

Tourists from the euro zone benefit from the simplicity of the common currency. And for investors, there is no conversion or exchange rate to worry about.

An accessible country

Getting to Portugal from France or Europe is quick and easy. The most popular airport for tourists is Lisbon. There are also other international airports such as Porto and Faro (to get to the Algarve). Flights are daily and competitively priced from all major European airports.

For example, from Paris, Lyon or Bordeaux, the flight takes less than 2 hours to Lisbon airport. And to get to the city centre, it takes 25 minutes by metro or 15 minutes by car or taxi.

To get around the country, you can count on a good road network infrastructure.

Portugal's good accessibility is a major asset for real estate investment projects by foreigners.

A safe country

Another advantage of Portugal, and one of the major differences with France, is the country's security. It has one of the lowest crime rates in the world. It is a peaceful and quiet country with a stable political regime. 

This is the reason why many French people invest in Portugal to live there, either for retirement or as a family.

A variety of leisure activities

The varied landscapes and environments allow for many activities. Portugal has around 60 golf courses, half of which are in the Algarve. On the coast, and particularly in the Algarve, you can enjoy every water sport imaginable.

In winter, in the Portuguese mountains, you can ski.

And if you like the great outdoors, you can enjoy the natural parks.

Wine tours are possible in the wine region of Porto, which produces the famous wine of the same name.

And the cultural heritage is not to be outdone! You can visit many tourist sites, which bear witness to the cultural wealth of Portugal in the Middle Ages and its great conquests in the 16th century.

Porto and Lisbon, dynamic cities

In Portugal, 2 cities are particularly dynamic.

Lisbon, the capital, is exceptionally well situated: at the mouth of the Tagus River, the city combines a rich cultural heritage, numerous nightlife events and proximity to the ocean. There are many tourists and digital nomads.

The property market in Lisbon is varied, as are its neighbourhoods. The average price per square metre is around €5,000, but it can reach €10,000 per square metre. The investment is most often for rental, due to the tourist pressure.

Further north, Porto is also a coastal city, but quite different. Smaller than Lisbon, it has many monuments to visit in a charming setting on the banks of the Douro. The wine from the surrounding hills is what the city is famous for. Many tourists enjoy the charms of Portugal's second city, but the tourist flow is quieter. Property prices are lower than in Lisbon, at around €3,500/m².

A large expatriate and nomadic community

If you are looking to invest in Portugal to live there year round, you will find a large expatriate community of all ages.

Working people have come to work here and have expatriated with their families.

There are also many retirees, especially French, who enjoy the Portuguese sunshine and low cost of living.

In Portugal, there are many digital nomads from all over the world. In an exceptional setting, they work from home, while enjoying the lively nightlife of Lisbon or the many festivals with international artists.

A real estate market that is conducive to buying

In Portugal, property prices are lower than in France, even if they are on the rise. If you are in the same situation, you will find that buying a house is much cheaper than in France. Investing in a primary or secondary residence is more accessible than in France.

The rising prices are driven by many foreign investors, especially for rentals in tourist areas. These buyers make the property market very dynamic.

Portugal's stability and strong institutions, especially banking, guarantee a secure investment in real estate.

So if you want to invest in your primary residence, you will find plenty of homes to buy. The first step will be to define the region of Portugal where you want to live.

And if you're looking for a rental investment, you'll probably target one of Portugal's two most popular tourist locations: Lisbon, with its dynamic entertainment and cultural wealth. Or the Algarve and its sumptuous sandy beaches.

The good return on rental investment in Portugal

Is it worth investing in rental property in Portugal? Some destinations, such as Lisbon or the Algarve, are very popular with holidaymakers. And the occupancy rate of seasonal rentals is logically very high.

As more and more tourists arrive, the pressure on holiday rentals has increased. Rental prices have risen, much to the delight of the owners.

The return on these rental investments is therefore very good and so is the return on investment. This is why Portugal's tourist destinations are highly sought after by investors from all over the world, especially from Europe.

On the coast, in the new build, you can invest in real estate projects with high quality services. And in old buildings, many villas are perfectly suited to your rental projects.

In the city, and especially in the city of Lisbon, you can invest in flats that are very easy to rent to holidaymakers.

An ever-improving economy

Portugal is part of the European Union and its institutions are stable and solid. Affected by the global crises (subprime, Covid, etc.) like the rest of the world, the country has managed to recover and return to growth. In 2021, it will post a growth rate of 5.5 % (Source).

The Portuguese economy, historically driven by tourism, has managed to find a balance and diversify. This is why Portugal attracts many foreign workers attracted by the professional opportunities and quality of life.

A breeding ground for start-ups

Lisbon attracts many start-ups that find emulation in meeting other innovative technological players. In particular, the fintech sector is well represented, to the extent that the city has become a world reference in this field.

In Lisbon, these very dynamic sectors regularly organise events that are sought after by professionals from all over the world, such as the Web Summit.

Portugal offers a crypto-friendly environment which explains the development of the cryptocurrency economy.

In summary, 10 good reasons to invest in real estate in Portugal:

1. Excellent quality of life
2. A sunny and warm climate
3. Low cost of living
4. Accessibility of the country from France and Europe
5. Everyday security
6. A wide range of leisure activities
7. The dynamism of cities like Lisbon and Porto
8. The large expatriate community
9. A real estate market that is conducive to buying
10. The good return on rental investment

And 2 bonus assets: Portugal's economy is improving and diversifying, especially in fintech and cryptos.

Thinking of investing? Take advantage of our comprehensive guide to secure your purchase.