Portugal Non-Resident Home Purchases Fall 10.3 Percent to 1,890 in the Second Quarter

Non-residents bought 1,890 homes in Portugal in the second quarter of 2026, down 10.3 percent on the same quarter a year earlier and just 4.7 percent of the 40,142 homes traded nationally, according to figures published by Statistics Portugal (INE) on 24 September. Residents took 38,252 of those transactions, or 95.3 percent of the market, while the national house price index rose 16.5 percent year on year over the same three months.

What it means for a foreign buyer

You are buying into a market that domestic demand now sets the price in, and you are paying a different price from the person standing next to you at the viewing. Non-residents paid an average of 421,166 euros per home in the quarter against 258,832 euros for residents, roughly 63 percent more. That gap is not a legal surcharge on foreigners, who face the same transfer tax scale as anyone else. It is a composition effect: non-resident purchases cluster in Lisbon, Porto and the Algarve coast and in higher-value stock, so the average is dragged upward by what foreigners choose to buy rather than by what they are charged for it. The practical consequence is that your IMT transfer tax and stamp duty will land in the upper bands, and your budget should be built from the 400,000-euro-plus band rather than the national average you will see quoted in market summaries.

If you are holding Portuguese property and planning to sell to an overseas buyer, the queue has thinned on both sides of the EU line. Purchases by buyers resident elsewhere in the EU fell 14.9 percent to 946, and purchases by buyers resident outside the EU fell 5.1 percent to 944. At the same time prices kept climbing, so the common assumption that a foreign-buyer retreat would soften asking prices has not held. What did soften is the rate of increase: quarter-on-quarter growth eased to 3.6 percent from 3.8 percent in the first quarter, the second consecutive quarter of deceleration. Outside prime coastal stock, pricing your listing to a Portuguese buyer rather than an international one is now the realistic route to a sale.

Buy for the domestic market, and sell to it.

What changed

The second-quarter figures mark a wider retreat than the market as a whole. Total transactions fell 6.4 percent year on year to 40,142 homes, of which 32,307, or 80.5 percent, were existing rather than newly built dwellings. Non-resident transactions fell 10.3 percent, well ahead of the 6.2 percent decline in resident purchases.

Values moved in the opposite direction from volumes. The total value of homes traded reached 10.7 billion euros, up 4.2 percent. Residents accounted for 9.9 billion euros of that, up 4.8 percent, and non-residents for 796 million euros, down 3 percent. Within the resident total, family buyers took 34,935 homes, 87 percent of all sales, at an average of 265,135 euros.

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Average prices rose across both groups but not at the same speed. The resident average climbed 11.8 percent year on year, while the non-resident average rose 7.6 percent. Foreign buyers are still paying more in absolute terms, but the premium is narrowing.

The mechanism

The figures come from INE's quarterly housing market statistics, the release that also carries the Housing Price Index, known in Portugal as the IPHab. The index rose 16.5 percent year on year in the quarter, split between 19.4 percent for existing dwellings and 13.1 percent for new ones. That is the second straight quarter in which the annual rate has eased, the first sustained deceleration since the second quarter of 2024.

The classification that matters for foreign buyers is residence, not nationality. INE separates purchases by where the buyer is resident and then splits the non-resident group between those resident elsewhere in the European Union and those resident outside it. A Portuguese national living in London counts as a non-resident buyer in this series, and a German who has moved to Lisbon and taken up residence counts as a resident. Market commentary that reads these numbers as a headcount of foreign nationals is misreading the series.

Context

Portugal removed residential real estate from its golden visa programme in 2023, closing the route that had brought a substantial share of non-EU buyers into Lisbon and the Algarve, and the non-habitual resident tax regime has since been replaced by the narrower IFICI incentive aimed at qualified professionals rather than passive investors. Foreign buyers still face no ownership restriction: a non-resident can hold Portuguese freehold on the same terms as a citizen, subject to obtaining a NIF tax number and, in many cases, appointing a fiscal representative. What has changed is not the right to buy but the incentive structure around it, and the second-quarter data is the clearest quarterly evidence yet of how that has fed through to volumes.

For buyers working out what the upper price bands cost to transact in, the IMI, IMT and AIMI tax rules for foreign owners set out the scale. The post-golden-visa purchase route covers what buying now does and does not get you in residency terms, and the September Euribor revision covers the financing side for anyone borrowing locally.

Sources

- Residents dominate Portugal's housing market as foreign buyers pull back, The Portugal News, 24 September 2026

- Housing prices slow down in Portugal, The Portugal News, 22 September 2026

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