The capital and largest city of Portugal remains a key international market for prime residential buyers. From a well-preserved historic city centre to world-class cultural landmarks and premier dining culture, there are many reasons for buyers to be interested in Lisbon. A rebound in tourists and a revitalisation of the residential areas across the city has made Lisbon a top destination. Costs for all types of prime residential property grew in 2023, with Lisbon resale apartments leading capital value growth of 2.6%. This is in contrast to new development apartments in the city, which have seen more muted capital value growth of 0.5%. Both new and resale villa units, meanwhile, saw capital value growth of 2.0% for the year.

Rents have followed a similar trend to capital values, but with greater variation. Over the pandemic, rents for new build property fell by 10.6% and 5% in 2020 and 2021, respectively. These values rebounded in 2022 with a 29.2% increase as markets reopened.

All types of prime residential products across the city have seen continued price growth since the global financial crisis over a decade ago. The non-habitual residence scheme – which was replaced earlier in 2024 by a new, more limited incentive programme – has historically supported growth in Lisbon. The announced end of these tax benefits coincides with a slight cooling of international demand for homes for sale at the end of 2023. However, despite these reduced incentives, foreigners still account for over 22% of the total demand for prime residential to both buy and rent property in Portugal.

Currently, average rental values for one‑bedroom apartments in the city centre are €1,723 per month for new units and €1,323 per month for older ones. Rents have now far exceeded pre-pandemic levels, a testament to the consistent demand from international renters.

Between 2015 and 2019, there was an average increase in capital values of around 15% per annum, which pushed the average price per square metre above €5,000. This trend continued in 2023, with prices reaching €6,620 per square metre.

_{Read the articles within Savills Spotlight on Portugal report below}