Lisbon Market Stabilizes as Porto Rents Climb 11% Annually
Portugal’s residential market is presenting a divided scenario, with Lisbon showing signs of price stabilization while Porto records significant valuation growth, particularly in the rental segment. The findings, detailed in the latest quarterly report from the real estate consultancy MVGM, indicate a potential shift in the country's property investment landscape. The data reveals that while demand remains high across the board, the two major cities are moving at different speeds.
According to the MVGM analysis for the second quarter of 2025, the average sales price in Lisbon reached €6,650 per square meter. This figure represents a moderate quarterly increase of just 0.5% and an annual appreciation of 6%. The city's rental market saw a marginal contraction of 0.4% from the previous quarter, with the average rent settling at €22.4 per square meter. However, this still constitutes a 3.3% increase when compared to the same period last year, demonstrating the market's underlying resilience.
In contrast, Porto's market displayed a more vigorous dynamic. The average sales price in the northern city rose to €4,094 per square meter, a quarterly increase of 1.2% and a significant 10.5% year-over-year jump. The rental sector in Porto was even more dynamic, with prices surging by 5.7% in the last quarter alone. This contributed to an 11% annual increase, bringing the average rental price to €17.4 per square meter. This sharp upward trend highlights the city's growing appeal for both residents and investors.
Ana Luisa Santos, Head of Residential at MVGM Portugal, provided commentary on the statistical findings. “These data reflect a stabilization of the market in Lisbon, after a period of forte valorization, while Porto continues to affirm itself as an attractive alternative, both for investors and for residents, with more accentuated growths, especially in the arrendamento,” she stated. Santos noted that the high demand for housing persists, but cost adjustments are becoming more apparent, especially in the capital.
The report suggests that after years of rapid price hikes, the Lisbon market may be reaching an affordability ceiling, leading to more moderate growth. Porto, with its lower price point and strong economic activity, is increasingly capturing overflow demand and investment interest. This has positioned it as a key driver of growth in the national residential market. The trend is expected to persist in the upcoming quarters, according to the consultancy.
“We believe that this tendency could maintain itself in the next trimesters, with Porto gaining ever more protagonism in the national residential panorama,” added Santos. The divergence between the two cities provides a more complex picture of the Portuguese real estate market, moving beyond a single national trend to a series of regionalized dynamics that require careful analysis from market participants. The data from MVGM will be closely watched by developers and investors to gauge the trajectory of Portugal's key urban centers.
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