Foreigners pay twice as much as locals to buy Portugal homes

Foreigners from outside the European Union are buying homes in Portugal for double the value paid by domestic buyers, helping to drive up prices in a nation where housing in cities is increasingly out of reach for many locals.

Non-Europeans paid an average €451,000 ($523,000) for a property in Portugal in the first three months of the year, compared with €225,000 paid by locals, the National Statistics Institute said in a report on its website. During the same period, EU buyers spent an average €310,000 to buy a home.

Together with Portugal, Italy and Greece are set to register record inflows of millionaires this year, investment migration advisory firm Henley & Partners said in a report on Tuesday. Italy is expected to attract more than 3,600 millionaires, Portugal may get more than 1,400 millionaires while Greece could draw more than 1,200 millionaires, it said.

Portugal, in particular, has attracted foreign residents with its mild temperatures, relatively low cost of living, tax incentives and its golden visa program. Surging property prices have created a problem for many locals, who struggle to find affordable homes.

Average house prices in Portugal reached €2,851 per square meter in May – two and a half times more than in the same month of 2015, according to real estate website Idealista.

In 2023, the country ended the golden visa program’s real estate investment route in a bid to ease property prices. The program, which is mostly popular with US, Brazilian and Chinese nationals, currently offers non-Europeans a fast-track to residency through options including a minimum €500,000 investment in eligible funds.