Housing affordability in Portugal continues to deteriorate, as property prices and rental costs grow faster than household incomes.
According to recent data from INE, the increase in housing prices over the past year has significantly outpaced wage growth, placing additional strain on both buyers and renters.
Supporting analysis reported by ECO highlights that:
Median house prices have risen at a faster rate than average salaries
Rental costs are consuming a growing share of household income
Access to homeownership is becoming more difficult, particularly for younger buyers
This growing gap between income and housing costs is most visible in urban areas such as Lisbon and Porto, where demand remains strongest and supply constraints are most severe.
The affordability challenge is being driven by a combination of factors:
Sustained demand from both domestic and international buyers
Limited housing supply entering the market
Higher financing costs compared to pre-2023 levels
For many households, this translates into delayed purchasing decisions or continued reliance on the rental market — which is itself under pressure.
From a broader economic perspective, affordability has become a central concern, influencing public policy discussions and housing strategies.
However, despite increased attention, the underlying imbalance remains unresolved.
The conclusion is difficult to ignore: housing in Portugal is becoming less accessible for a growing portion of the population.
And without a significant shift in either supply or income growth, that trend is unlikely to reverse in the short term.
Source: INE; ECO
Date: 2025 – early 2026 data and reporting