What real estate can be considered cheap? The answer to this question is not so simple. The price and value of any property depends on its size, geographic location, and condition. But equally important is who is planning to purchase it and for what purposes. Regular readers of WithPortugal.com may have noticed that our articles on real estate often feature house ruins for sale at prices of 15-20 thousand euros. They are certainly the cheapest option to acquire. However, in order to start using them for their intended purpose, a considerable amount of money must be invested in new construction. As a result, is this type of real estate really cheap?
In this article, we will be looking for the cheapest real estate in Portugal that is suitable for living and does not require major renovations. Let's imagine a couple who are moving to Portugal. They have a remote job, so there is no need to be attached to any particular city. They want to understand how much it will cost them to rent or buy housing that meets their needs. Since their funds are not unlimited, they are looking for the cheapest of acceptable options.
We will focus on residential real estate for personal/family use. Let's start with the question of what to expect from real estate in Portugal. Then we will analyze the rental market and after that, we will look at the situation in the sales market. In both cases, we will also provide examples of current real estate listings on the website.
What is housing like in Portugal?
The population census conducted in 2021 revealed the following facts about Portuguese housing:
- The majority of residential buildings in Portugal (83.7%) are one- and two-storey buildings.
- 64.2% of residential buildings are in need of repair.
- Housing for permanent residence usually consists of 4-5 rooms.
- 51.9% of family dwellings have a living area between 60 and 119 square meters, with an average living area of 112.4 sq.m.
- Portable devices (such as electric and gas heaters) are mostly used for heating.
- The majority of family dwellings (83.4%) do not have air conditioning. However, this percentage is lower (63.5%) for buildings constructed in the last decade.
- Only 34.0% of residential buildings are accessible for wheelchair users. For buildings constructed in the last decade, this percentage reaches 68.2%.
- 63.6% of residential spaces in Portugal are somewhat overcrowded, with only 23.7% being considered adequately occupied for their size.
- 61.6% of residential spaces occupied by their owners are not under any mortgage load.
- The cost of purchasing housing is around 360.5 euros per month.
- The average monthly rent is 334 euros.
The rental of the cheapest real estate in Portugal
Let's imagine a couple who has just arrived in Portugal. They have a remote job or passive income. They haven't decided where they will permanently live yet, so they want to rent an apartment for the time being. Their goal is to rent it as cheaply as possible. It's not important where exactly they rent it. What information will help this couple find their ideal home?
I would suggest starting the search by analyzing the data from the National Institute of Statistics for the 3rd quarter (July - September) of 2022. Why specifically the 3rd quarter of 2022? Unfortunately, this is the most recent data available at the moment. The National Institute of Statistics publishes quarterly reports. Since they are very detailed, they cannot be generated quickly.
The map shows regions with corresponding gradations of the average (median) price per square meter. Four gradations are indicated by different shades of purple:
- The average cost per square meter for renting ranges from 2.67 to 4.00 euros (the lightest shade),
- The average cost per square meter ranges from 4.00 to 5.00 euros
- The average cost per square meter ranges from 5.00 to 6.55 euros
- The average cost ranges from 6.55 to 10.16 euros (the darkest shade).
The map shows that the average price per square meter for renting is directly proportional to the proximity to the coast, and is higher in major cities along the coast. Additionally, the price is relatively high in Madeira and relatively low in the Azores. It is highly likely that this situation is ongoing, rather than just specific to the 3rd quarter of 2022. Therefore, those seeking the cheapest rental property will likely find it in the eastern regions of Portugal: T. Trás-os-Montes, Tâmega e Sousa, Beira Baixa, Beiras e S. Estrela, Douro, and Alto Alentejo, as well as the Azores. If we talk about the coast, the cheapest housing is most likely available for rent in the Alto Minho and Leiria regions.
Now let's turn to the Idealista.pt website and see what rental offers are available on it right now. As an example, let's take one of the eastern sub-regions of Portugal, Terras de Trás-os-Montes, and the western region of Leiria.
Terras de Trás-os-Montes subregion, apartments
325 euros/month One-room apartment with an area of 25 square meters. Furnished. Condition is not brand new, but not terrible either, if we believe the photos. Located in the city of Bragança.
420 euros/month One-bedroom apartment with an area of 90 square meters. Furnished. The repair is very subjective. Located in Bragança.
Terras de Trás-os-Montes subregion, houses
500 euros/month One-storey house with an area of 150 sq.m. 3 bedrooms, 2 bathrooms, garage. Comes furnished with an equipped kitchen. Located in the city of Bragança.
860 euros/month Two-storey house with an area of 265 sq.m. and 5 bedrooms. Equipped kitchen, each bedroom has a bed and a desk. Wi-Fi available. The rooms can be rented separately (180 euros per room), but for some reason only 4 are offered. Located in the city of Bragança or very close surroundings.
1,000 euros/month One-storey countryside house with stunning views. Area of 200 sq.m. with 3 furnished bedrooms, 1 living room, equipped kitchen, garage, terrace, and grill. Air conditioning and central heating available. The property has a plot of 1900 sq.m. and is located in the municipality of Mogadouro.
Leiria region, apartments
400 euros/month A floor in a 2-storey house with an area of 90 square meters. It has 2 bedrooms, 1 bathroom, and a kitchen combined with a living room. Furnished. Located in Vieira de Leiria.
450 euros/month A studio with an area of 35 square meters. Garage is included in the price. Located near Peninche.
460 euros/month A studio with an area of 30 square meters. Recently renovated. Unfurnished. Located in Leiria.
550 euros/month A T1 apartment (with a living room and a bedroom) with an area of 51 square meters. Recently renovated. Furnished. No garage or parking available. Located in Leiria.
Leiria region, houses
450 euros/month Single-storey house with an area of 120 square meters. 1 living room, 1 bedroom, 2 bathrooms, equipped kitchen, garage, terrace. Not far from Alcobaça.
750 euros/month Single-storey house with an area of 72 square meters. 2 bedrooms, 2 bathrooms, equipped kitchen. Rented with furniture. Plot of land of 5 acres. São Martinho do Porto.
850 euros/month Two-storey house with an area of 195 square meters. 2 living rooms, 3 bedrooms, 2 bathrooms, equipped kitchen, garage, plot of land. Municipality of Ansião.
Buying the cheapest real estate in Portugal
Let's assume that our couple is determined to live in Portugal and is therefore seriously considering buying a property. They can also use the research of the National Institute of Statistics to get oriented in the market of affordable Portuguese housing. As with rentals, the freshest data available to us relates to the 3rd quarter of 2022. However, there is more of this data, so it is possible to assess the situation more fully.
The cheapest regions of Portugal
The graph shows all the regions of Portugal (left column). Within each region, municipalities with the lowest and highest prices per square meter of real estate when buying are indicated. The names of these municipalities are also given. We are interested in the bottom part of the graph. According to it, the cheapest region in the 3rd quarter of 2022 was Alto Alentejo (visually just under 1,000 euros per square meter). The cheapest municipality in it was Crato (less than 500 euros per square meter), and the most expensive was Porte de Sor (about 800 euros per square meter). If we believe this graph, there were about 10 regions with an average square meter price of up to 1,000 euros. Remember that this data is six months old, so prices have probably changed since then, but the list of the cheapest regions is likely to have remained the same.
A moment of statistical theory
Up until this point, we have only seen one indicator of housing cost, the average cost per square meter. There are several ways to calculate this average cost. The National Institute of Statistics of Portugal, in its research on real estate prices, uses the median as the average. The median is the middle value of a set of numbers - the number that lies in the middle of the set when it is arranged in ascending order.
The National Institute of Statistics also provides data that helps understand the range in which the price per square meter is likely to fall in each region. In some of the tables presented below, you will see the so-called 1st and 3rd quartiles. I won't go into detail about what they are, or we'll end up with a textbook on statistics instead of a real estate article. The main thing to understand about quartiles is that they show the beginning and end of the range within which half of all the numbers in the dataset fall.
Next, we will examine the data collected by the National Institute of Statistics over the year (October 2021 - September 2022). As I have already mentioned, we do not have more recent data, so we work with what we have.
If we look at the first row of the table, we'll see the average price per square meter calculated based on data from all property sales across Portugal (1,466 euros), as well as the first quartile (893 euros) and the third quartile (2,159 euros). There were many of these transactions, possibly even thousands. Exactly half of these transactions were made at a price per square meter in the range of 893 to 2,159 euros. This is exactly why quartiles are needed - to show the lower and upper boundaries of the price range in which 50% of real estate transactions took place in a particular area. In the case of the whole country, the range is quite large, but this lower boundary of the interval should be of particular interest to those looking for cheap real estate, as it shows what price per square meter can realistically be found.
In this table, the cheapest regions are at the beginning of the list. If we focus on the 1st quartile, i.e. the lower bounds of the price intervals, we will see that there are 10 regions where it was possible to find housing with a square meter price within 500 euros in 2022. These are Alto Alentejo, Beiras e Serra da Estrela, Beira Baixa, Baixo Alentejo, Douro, Terras de Trás-os-Montes, Médio Tejo, Alto Tâmega, Viseu Dão Lafões, and Alentejo Central.
The cheapest municipalities in Portugal
Each region of Portugal includes several municipalities. Each of these municipalities has its own situation with real estate, so prices can vary greatly.
This map shows the municipalities with a corresponding gradation based on the average level of prices per square meter. The white areas indicate territories with no data (most likely, there were no registered real estate transactions in that period). Then, four gradations are indicated with different shades of purple:
- The average price per square meter of sold property ranges from 171 to 500 euros (the lightest shade),
- The average price per square meter of sold property ranges from 500 to 800 euros,
- The average price per square meter of sold property ranges from 800 to 1,446 euros,
- The average price per square meter of sold property ranges from 1,446 to 3,785 euros (the darkest shade).
As we can see, the cheapest municipalities are concentrated in the east, but even in the western part of the country there are municipalities with average prices up to 800 euros per square meter. Yes, it may not be the coast, but still relatively close.
The table below shows 50 municipalities with the lowest average price per square meter based on data accumulated over 12 months (October 2021 - September 2022). The region to which they belong and the 1st and 3rd quartile of the price range are indicated for each municipality.
According to this data, the municipality with the cheapest real estate in 2022 was Figueira de Castelo Rodrigo with an average price of 171 euros per square meter. At the same time, the price range in which half of the transactions in this municipality were made is from 79 to 500 euros. It's interesting what kind of building was there for 79 euros per meter?
As we can see, in all 50 municipalities on the list, the average price per square meter does not exceed 500 euros. Speaking of the regions to which these municipalities belong, they are mainly the same ones in the east of the country that were on the list of the cheapest regions: Alto Alentejo, Beiras e Serra da Estrela, Beira Baixa, Baixo Alentejo, Douro, Terras de Trás-os-Montes, Médio Tejo, Alto Tâmega, Viseu Dão Lafões, Tâmega e Sousa, Alentejo Central. Additionally, three regions with access to the ocean also made it to these 50 municipalities: Azores (Graciosa), Alto Minho, and Leiria.
So, those who are looking for the cheapest real estate in Portugal and do not have any location preferences, can start searching in these 50 municipalities.
The cheapest municipalities in the most expensive regions
What if you want to live reasonably close to a big city? What if you want to have the opportunity to go to the ocean without spending half a day? Is it true that only the most expensive real estate is available near Lisbon and other tourist attractions? The National Institute of Statistics of Portugal can help answer this question again. Data on real estate sales from October 2021 to September 2022 is available for the regions of Algarve and Madeira, as well as for the Greater Lisbon and Greater Porto urban areas.
Each table shows several of the cheapest municipalities for the respective region (top part of the table), as well as the most expensive municipalities for comparison (bottom part of the table).
In the Greater Lisbon metropolitan area, the lowest price per square meter for buying property was in the town of Moita. The average price was 1,214 euros per square meter, and half of all transactions were made within the range of 935 to 1,481 euros per square meter. Moita is located 40 km from the center of Lisbon, in the northern part of the Setúbal peninsula. The next town on the list, Barreiro, is located nearby. The city of Palmela, which is in third place, is closer to the district capital, the city of Setúbal, which is in fourth place. The average price per square meter in Setúbal was 1,583 euros, and half of all transactions were within the range of 1,237 to 1,942 euros per square meter. For comparison, in the most expensive city in the Greater Lisbon metropolitan area, Lisbon (which is logical), the average price per square meter was 3,785 euros, and the range of prices for half of all transactions was from 2,936 to 4,907 euros.
In the Greater Porto area, the cheapest municipality turned out to be Arouca with an average price per square meter of 787 euros and a price range of 409 to 1,069 euros. Arouca is located 63 km from the center of Porto and belongs to the Aveiro district. It is followed by Oliveira de Azemeis, São João de Madeira, and Vale de Cambra. They are also located in the Aveiro district, at a distance of 40-55 km from the center of Porto. It was a surprise for me that Greater Porto has such wide borders. Municipalities with slightly higher prices belong to the Porto district and are located within a radius of 35 km from the center of Porto: Paredes, Santo Tirso, Trofa, and Valongo. Santa Maria da Feira is located at the same distance from Porto, but belongs to the Aveiro district. Real estate could be purchased there at an average price of up to 1,361 euros. However, those who bought property in the most expensive location in this region, the city of Porto, paid an average of 2,467 euros per square meter.
The lowest prices for square meter of property in Madeira archipelago were in the municipality of Porto Moniz in the northwest of the island, in the most remote area from the capital city of Funchal. The average price per square meter was 725 euros, with 50% of transactions made at a price range of 425 to 1,173 euros per square meter. The municipalities of Santana (north of the island), Ribeira Brava (southwest), and São Vicente (north) follow in increasing order of price, where the average price per square meter is up to 1,074 euros. The most expensive is the city of Funchal, where property prices range from 1,450 to 2,617 euros per square meter.
In Algarve, the cheapest municipality was the farthest from the ocean - Alcoutim. 50% of deals were made in the range of 288-785 euros per square meter, with an average price of 518 euros per square meter. The next in line, Monchique, which is much closer to the coast, was twice as expensive, with an average price of 1,063 euros per square meter. São Brás de Alportel, which is actually quite close to Faro, the capital of the region, ranked third, with an average price of 1,712 euros per square meter. Then come Olhão and Silves with an average price per meter within 1,889 euros. However, if you want to live in the most expensive municipality in Algarve, Loulé, be prepared to pay at least 1,000 euros per square meter more. The average price per meter is 2,894 euros, and half of the deals were made in the price range of 2,033-3,870 euros.
The cheapest apartments and houses available for purchase in March 2023
Armed with lists of the cheapest regions and municipalities, our couple can now start their search for housing. As before, they can search for sale listings on Idealista.pt, the largest real estate portal in Portugal. It is important to note that the prices they will see on Idealista are likely to be higher than those in the National Institute of Statistics study. There could be many reasons for this. First, of course, is the factor of time (the listings will be current as of today, while the study is at least six months old). Secondly, it is possible that when owners list properties on the website, they inflate the price to account for potential negotiation, and in most cases, they ultimately lower the price. So keep in mind that it should be possible to negotiate the price down. Thirdly, we do not know the condition of the properties included in the report, whereas we will be looking at listings for housing in decent condition.
We will be searching for real estate to buy in 4 municipalities from the list of 50 cheapest municipalities mentioned above.
Figueira de Castelo Rodrigo, houses (there were no apartments offered there)
39,000 euros A house that needs significant renovation, possibly extensive. Offered by a bank. The area of the house is 98 sq.m. It has a kitchen, a living room, 2 bedrooms, 1 bathroom, and an attic. It might be suitable for an investor, but not for an immediate move-in for a family. Located in Figueira de Castelo Rodrigo.
Next, we will only consider options that are suitable for comfortable living.
70,000 euros A two-storey house with an area of 144 square meters. 4 bedrooms, 2 bathrooms. A plot of 48 square meters. As far as I understood, it is an offer with furniture, but the furniture is not that great in my opinion. Energy efficiency class F. Located in Figueira de Castelo Rodrigo.
119,000 euros A two-storey house with an area of 174 square meters. 4 bedrooms, 2 bathrooms, balcony, and terrace. Garage. Plot size is about 500 square meters. There was a renovation 2 years ago. Energy efficiency class C. Located in Figueira de Castelo Rodrigo.
120,000 euros A house of cheerful green color will require at least cosmetic repairs both inside and outside. The area is 266 square meters. 5 bedrooms, 3 bathrooms, 3 living rooms, a wine cellar, a garage, and a garden. Located in Figueira de Castelo Rodrigo.
129,990 euros A house with an area of 254 square meters. 4 bedrooms, 1 bathroom, balcony, and terrace. Garage. Central heating. A shop can be arranged on the first floor. Energy efficiency class F. Located in Figueira de Castelo Rodrigo.
Fornos de Algodres, apartments
70,000 euros Apartment with an area of 77 square meters. 2 bedrooms, 1 bathroom, balcony. Garage for 2 cars. The building was built in 2006. Energy efficiency class F.
85,000 euros Apartment with an area of 92 square meters. 2 bedrooms, 1 bathroom, balcony, storage room. Air conditioning. Energy efficiency class F. Fornos de Algodres.
87,500 euros Apartment with an area of 180 square meters. 3 bedrooms, 2 bathrooms. Central heating. Garage. The walls in each room are painted in their own color, some are very saturated. So at least cosmetic repairs will be needed. Fornos de Algodres.
95,000 euros Apartment with an area of 190 square meters. 3 bedrooms, 2 bathrooms. Built-in kitchen. Fornos de Algodres.
Fornos de Algodres, houses
50,000 euros A two-storey house with an area of 150 square meters. It has 2 bedrooms, 1 bathroom. Recently renovated. The plot is 220 square meters. Energy efficiency class F. Fornos de Algodres.
81,000 euros An apartment with an area of 120 square meters. 2 bedrooms, 1 bathroom. The house was built in 2005. Energy efficiency class C.
37,500 euros House with an area of 96 square meters. 2 bedrooms, 2 kitchens, 1 living room. Nothing is said about the bathroom, but I really hope it exists. The house is positioned as traditional for Alentejo. Is it really so traditional that the facilities are in the yard? Energy efficiency class F. Fronteira.
75,000 euros An 89 square meter apartment with 1 bedroom and 1 bathroom. It seems that the living room is combined with the kitchen. Energy efficiency class F.
90,000 euros A 130 square meter apartment with 3 bedrooms, 2 bathrooms, and a terrace. Fully equipped kitchen, pantry, and laundry room. Energy efficiency class E. Located in Mogadouro.
40,000 euros A two-storey house with an area of 204 square meters, 4 bedrooms, and 2 bathrooms. An offer with furniture. The kitchen furniture will need to be replaced. Plot size is 40 square meters. Mogadouro.
50,000 euros A house with an area of 145 square meters, with a design that may not appeal to everyone. It has 5 bedrooms and 3 bathrooms. Energy efficiency class is E. Mogadouro.
In the end, is it really possible for a foreigner to buy property cheaply in Portugal?
I would say that nothing is impossible, but of course, without knowledge of the language and local specifics - both geographical and mentality-wise - a foreigner risks spending at least his energy and nerves. If there is no time or desire to delve into the details, then professional real estate agents in Lisbon, Porto, the Algarve, Figueira da Foz, and Madeira, who can be contacted through our website, can help. They will be happy to advise on purchasing an apartment or house at any budget. Those who are looking for an investment option may be interested in the property management service in the Algarve.
If your goal is to buy property in Portugal, I wish you to find one that adequately meets your needs and is within your budget!