Overview

Housing crisis in Portugal became a serious problem. Portugal is currently facing a lot of problems, and the most important issue among them is the accommodation and housing. The prices of both renting and buying have reached the sky.

A normal person with an average salary can only afford to buy their own house because the prices are very unreasonable. I don’t think anyone with a 9-5 job would be able to buy a house here easily because even your basic salary is very low, more than half of which goes into your rent, so the rest you eat, drink or save, so overall with a normal salary you cannot dream of having your own house. 

Every person dreams about to buy a beautiful house with their family, then it is not easy because it is no longer within the reach of a common man. Currently, the situation of the property market is very bad. The housing crisis in Portugal has become worse. Prices have reached their record highs in comparison to previous years. The government is introducing its new policies, like construction, but the situation is not improving.

Housing Crisis in Portugal with High Prices 

Millions of families throughout Portugal are directly impacted by the housing crisis, which continues to rank among the nation’s most significant social and economic issues.  Though it is most prevalent in the Algarve region and the Lisbon and Porto Metropolitan Areas, the phenomenon, which has grown in dramatic proportions, is present in almost every region. 

 Young people and the middle class are being driven to the periphery and, more and more, out of the Portuguese housing market entirely by the ongoing increase in sale and rental prices, coupled with a shortage of supply.

Portugal was among the nations most impacted by the price increase, with housing expenses rising 78% between 2012 and 2021—more than twice the EU average.  Average home prices increased by more than 9% in 2024 alone, and at the start of 2025, Portugal saw the largest annual increase in property prices in the EU, rising 16.3%.

Similar trends were seen in rents, which rose by 11% in 2023 to an average of €7.27 per square meter, surpassing €11 in Lisbon.  Young individuals, single-parent households, and so-called middle-class couples are especially impacted by this circumstance, as they increasingly struggle to find acceptable housing options.

Housing Crisis in Portugal and Upcoming Difficulties

The European Commission is preparing an affordable housing strategy that will be unveiled in the spring of 2026 as a result of increased concern over the housing problem on a European level.  This plan will address topics including rental regulations, social housing support, construction, refurbishment, and administrative simplification with the goal of involving national governments, local authorities, investors, and citizens.

2,000 of the 26,000 units intended for social housing had been delivered by the middle of 2025, falling well short of the number of new residences promised by succeeding governments.  Although 33,000 dwellings is the new goal for 2030, the current delivery rate is significantly slower than what is required to quickly address the issue.

Housing Crisis in Portugal: Problems and Solutions

Housing crisis in Portugal can be solved with detailed planning and policy implementation. 

The government should make investments in public housing and rental regulations that are supported. 

The state should reduce and control the effects of short-term rentals and foreign demand in cities.

 Make investments in urban redevelopment and provide incentives for the sale of unoccupied real estate. 

To speed up house building, the government, municipalities, the private sector, and civil society should better coordinate. 

 One of the biggest social issues facing the nation right now is the housing crisis, which is still far from being resolved.  In order to guarantee that everyone has access to quality housing, the growing housing shortage and rising costs necessitate prompt, coordinated responses from all political and economic parties.

Housing Crisis in Portugal for Immigrants in 2025

Due to Portugal’s housing problem, which renders the majority of accessible homes unaffordable for them, some migrants are resorting to temporary housing, such as tents. ‘Home’ has been a camping on the outskirts of Lisbon, the capital of Portugal. People use tents and camper vans to make ends meet after being priced out of housing in the major cities and villages, just like many other migrants and even some Portuguese residents.

Portugal still has one of the lowest average earnings in Western Europe, despite the fact that the cost of purchasing or renting residential real estate has increased significantly.  As a result, more and more people are having trouble adjusting.

The number of immigrants who can pay greater costs than the locals and migrants has recently increased, yet Portugal still has a persistent shortage of affordable housing.  Portugal’s offer of residency privileges to individuals who purchase or rent real estate has reportedly attracted some of these foreigners, according to Reuters.  

The state also provides tax advantages, which attract both EU nationals and individuals from non-EU nations, such as the USA, to relocate to Portugal or work there. In addition to this, Portugal has seen a surge in tourists, which has caused many rental units to be converted to short-term vacation rentals, further compressing the housing market.

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