So, you are finally in Lisbon! You have a flat and a job, and your life is moving forward quickly. Well done! But if you plan to settle in the city for long, then you might be looking into buying property here. And this is where this post comes in鈥攂elow, we've summed up some tips to help you plan your property purchase in Lisbon.
Investing in property in Lisbon
The housing market in Lisbon (and Portugal as a whole) is doing quite well for investors, with property prices consistently moving up over the last 10 years.
However, social unrest is rising due to the fact that people are no longer able to buy or rent in the cities where they work/study. In order to tackle this urgent issue, the local government is pushing new legislation to try to solve the housing crisis that is currently plaguing the country. As part of this new policy, it is no longer possible to enter the Gold Visa Scheme for buying 500,000鈧� worth of property in Lisbon. This program grants participants the right to live in the country legally for a period of 10 years, after which they can apply for citizenship. There are still other ways to partake in the scheme, but buying property in the capital is no longer one of them. Furthermore, this new legislation to tackle speculation and high prices has given city councils full autonomy to suspend the issuance of permissions to open new Airbnb's. As of now, it is not possible to open an Airbnb in Lisbon, so you won't be able to rent your property to tourists (legally) if you're away from the city.
If your main goal as an investor is to flip properties, the real estate market in Lisbon just keeps on booming, as property prices in the metropolitan area have risen by nearly 8% in the past year alone. That said, you should also factor in Portugal's relatively high transaction costs when buying property in Lisbon, since buyers are responsible for liquidating the IMT (property transfer tax), stamp duty, deed registration costs and any additional banking fees if financing is required.
The only fixed cost is related to the house deed, which usually stands somewhere around 鈧�1000 to 鈧�1500. The remaining costs will depend on how much you paid for the house, such as the IMT (different brackets for different property prices), the stamp duty over the property purchase (0.8% of the sale price) or the stamp duty over the bank loan (0.6%).
To ease this burden on younger buyers, the government approved new legislation in 2024 aimed at residents aged 18鈥�35 who purchase their first home. Under this program, the State can finance up to 10% of the property price, helping buyers meet the usual down payment requirement (banks typically finance no more than 90%). In addition, eligible first-time buyers are exempt from paying the IMT or the stamp duty over the property purchase price. However, keep in mind these benefits only apply if this is the buyer's first home, if the property price does not exceed 鈧�450.000 and if the buyer's annual income falls below 鈧�83.696. This program is valid for all legal residents, regardless of nationality.
Conversely, if you're selling property in Lisbon instead, you'll need to account for agent commissions (usually 5% of the sale price) 鈥� plus 23% VAT on that fee 鈥� along with other legal expenses. In addition, capital gains tax (28%) may apply if you don't reinvest the profit into another property. However, only 50% of capital gains on property sales are subject to IRS, although an additional 5% 鈥渟olidarity tax鈥� applies to EU residents outside Portugal. For non-EU residents, there are no tax discounts 鈥� meaning they have to pay the full 28%!
Property prices in Lisbon
A hot destination for expats all over the world, Lisbon has seen the housing market consistently blossom over the past decade or so, resulting in the highest property prices ever recorded. Since January 2015, the average square meter price in Lisbon has gone up from 1,300鈧� to a staggering 4,360鈧�. In central Lisbon, in neighborhoods like Baixa, Bairro Alto, Chiado and Rossio, property prices have risen to 5,720鈧� per square meter (May 2025 figures), an extraordinary 160% leap in just a little over 10 years! According to stats from , one of the country's biggest real estate portals, , a 33% spike compared to 2024.
That said, the prices per square meter in Lisbon are still relatively tame when compared to other capitals in Western Europe, though wages are noticeably low, and a lot of young people are currently struggling to be able to afford to leave their parents' homes. To make matters worse, interest rates have risen sharply compared to 2022, with the Euribor 鈥� the interest rate used to calculate interest on bank loans for buying property 鈥� currently standing at around 2% (it was sitting below 0% between 2015 and 2022). Be that as it may, paying your mortgage in monthly installments is definitely cheaper than renting, as Lisbon sits among the most expensive cities to rent in Europe, according to the (average rent prices for an apartment in the city in the first quarter of 2025 hover at around 鈧�1,750). This makes buying property in Lisbon an excellent investment for expats who decide to stay in the city for longer, calling it their permanent home.
Obviously, prices will differ according to the area you're researching. In Benfica, Carnide, Lumiar or Marvila, for example, which are located right outside the city center, the average square meter price stands at around 5,000鈧�, while the areas where the middle class used to reside, such as Odivelas, Loures or Amadora, can still offer a good bargain for budget-savvy expats (3,000鈧� per square meter). On the other hand, if you're running on a pretty tight budget and don't mind living quite far away from the city center, you may look up your options in Sobral do Monte Agra莽o, Azambuja and Arruda dos Vinhos, about 50km away from the downtown (1,800鈧�-2,400鈧� per square meter).
Where to look for housing in Lisbon
If you are new to the area, it is definitely better to arrange your property purchase via a real estate agency.
Real estate agents in Portugal need to be government-registered and have a license number issued by the . To check if the agent you are planning to work with is officially registered, you can contact the Instituto dos Mercados P煤blicos do Imobili谩rio e da Constru莽茫o.
You should also be aware that real estate agents in Portugal work in the interest of the seller, and receive their commission from the seller as well. The good news here is that you won't have to pay a commission when buying a home. However, to make sure someone is looking out for your interests as well, it is best to get independent advice before signing any contracts.
There are countless real estate agencies and websites that can support expats when finding their new home in Lisbon: , and being a few of them. Facebook Marketplace is also a good place to find independent sellers, as long as you're especially attentive.
Good to know:
Most real estate agencies will speak English and can assist you throughout the buying process as well.
Conditions to be met for buying property in Lisbon
The process of buying property in Lisbon can be anything but simple for non-natives. You are going to need a lot of paperwork, and it is easy to make a mistake and have to start the process all over again. If you are considering buying a house or property in the city's historic center, then you will definitely need a Portuguese lawyer, as houses in this area usually require specific licensing and permits, especially if you're planning on doing renovations.
It's worth noting that the majority of Portuguese residents own the properties they live in. Generally, there are no restrictions or complications for expats who want to purchase property in Portugal. However, things are changing quickly, and certain political parties have been calling for a ban on the purchase of houses/apartments by foreign citizens.
To purchase property in Lisbon, you will need to go through several steps:
First, you will need to apply for a tax ID number (N煤mero de Identifica莽茫o Fiscal aka N煤mero de Contribuinte). The process is quite straightforward, and you will easily get the papers you need from your local tax office. To make things even easier, you can start by opening a bank account in Portugal (you will need one to purchase property), and you will automatically get a tax ID number.
Once you have found the property you are interested in, it's time to make an offer. This is the key part of the buying process, and it's highly recommended to have an independent solicitor by your side to guide you through this stage. You will also need to employ a notary to oversee the transaction. You can search for one locally or through a large directory like the European Directory of Notaries. If your offer is accepted, your notary will review the transaction and check the property you are about to buy. They will typically do so via the Land Registry and Inland Revenue to make sure there are no outstanding issues with the property you are about to buy.
After agreeing on a price with the seller, you will have to sign a Contrato de Promessa de Compra e Venda (CPCV), a legal contract where both you and the other party agree to move forward with the deal and set a completion date for the transaction. Usually, a deposit is agreed upon as a guarantee. If you back down from the deal, the seller gets to keep your deposit. On the other hand, if it's the other party that breaches the contract, they are legally obliged to return your deposit in double. Should you need to take a bank loan, please be aware that banks are only able to lend 90% of the total loan value, meaning you need to have the remaining 10% as a down payment.
Finally, you will need to sign the Deed of Purchase and Sale (Escritura P煤blica de Compra e Venda), after which you can register the property in your name.
We do our best to provide accurate and up to date information. However, if you have noticed any inaccuracies in this article, please let us know in the comments section below.
