Madeira is a Portuguese archipelago in the Atlantic Ocean, famous for its impressive natural landscapes and favorable climate. This corner of the world attracts not only travelers from mainland Portugal, but also people from different countries who have decided to settle here permanently.
This article will talk about the changes in the real estate market in Madeira in the summer of 2024. We will look at the price dynamics from May 1 to July 31, including purchase, long-term and short-term rentals. In addition, there will be examples of the most expensive and budget offers in the residential real estate market available for sale in August 2024.
Real estate price dynamics in Madeira
The study begins by analyzing data provided by Idealista.pt, one of the leading sources of information on real estate in Portugal. Given that August is still ongoing, we will focus on data for the three completed months of May, June and July.
As can be seen from the charts, the sale market and the rental market developed differently in the last year. The average price per square meter in the sale of real estate showed a stable and almost uniform growth. As a result, during this period, the average price increased by 16.8%.
But the average price per square meter for rent showed different dynamics: from September to November last year there was a decline, after which the price began to grow rapidly and reached a peak in January this year. This was followed by a slower decline, which lasted until March. This was followed by an even slower rise and then, in May, there was also a slow decline. As a result, the price decreased by 0.7% over 12 months.
The graphs show the average data for all the municipalities of Madeira. In the future, we will analyze in detail the situation in each of the municipalities of the archipelago.
Real estate for sale in Madeira municipalities
The table compiles data on the average price per square meter of real estate in the different municipalities of Madeira, based on listings for sale on the Idealista.pt website. The first three columns show the prices for May, June and July 2024. The fourth column shows the percentage change in prices for the three months indicated, displaying how much they have increased or decreased over the period. The fifth column shows the change over the past calendar year. The municipalities in the table are arranged in descending order of average price per square meter as of July 2024.
The highest average price per square meter is observed in Funchal, the capital of the region. In July this year, the price was 3,389 euros per square meter, which was the result of a very modest quarterly increase of 1.01% and an annual increase of 13.7%.
Another municipality where the average price per square meter exceeded 3,000 euros is Calheta with 3,339 euros in July this year. This figure has increased by 2.49% since May and by 19.9% since last July.
The next group includes municipalities with an average cost per square meter between 2,100 and 2,900 euros. These are Ponta do Sol, Ribeira Brava, Câmara de Lobos and Santa Cruz. In these municipalities, the changes over the quarter were multidirectional: from -3.7% to +1.43%. But in terms of the year, they all showed strong growth. The champion of the pace in the whole of Madeira was Ponta do Sol, where the price has increased by 30.3% since July last year.
At the end of the list is the municipality of Santana, where the average price in July 2024 amounted to 1.463 euros. This value was the result of a quarterly decrease of 2.07% and an annual increase of 1.1%.
Can the statistics of the Idealista.pt website be trusted?
Idealista.pt is in most cases the starting point for foreigners interested in the real estate market in Portugal. However, it is worth remembering that the information presented on it is based solely on advertisements from sellers and landlords, which may not give a full picture of the current state of the market. The statistics of this site show the situation only from the side of property owners.
In order to get a more complete and accurate picture of the market, it is important to take into account the data of actual transactions. These objective data are provided by the Portuguese National Institute of Statistics on a quarterly basis.
At the moment, the most up-to-date information on the real estate market in Madeira from the National Institute of Statistics refers to the first quarter of 2024. To check the accuracy of the information from Idealista.pt, you can compare the figures from both sources.
The table shows average prices per square meter from two sources: the report of the National Institute of Statistics (column 1) and Idealista.pt (column 2). The third column shows the percentage difference between these data. The report of the National Institute of Statistics includes only Funchal.
The comparison shows that the actual prices per square meter in the completed transactions were significantly lower than those presented on Idealista.pt. The difference amounted to almost 22.5%, which can be explained by differences in the methods of calculating average prices between sources, as well as possible price reductions during negotiations between sellers and buyers.
What is the bottom line: can we fully trust the average cost per square meter figures obtained from Idealista.pt? On the one hand, the discrepancy is too large. On the other hand, it is the only source of fresh data. In the current situation, we will focus on Idealista statistics, but always keep in mind that these data do not always accurately reflect reality.
These figures should be taken as a guide and not as the final truth. Actual market conditions may differ, and the data available on the website may not take into account all the nuances. To get a better idea and avoid unpleasant surprises, potential homebuyers should contact a real estate agent who works in Madeira and knows the ins and outs of the local market. This will help not only to clarify current trends, but also to make a more balanced and informed decision.
Long term rental properties in Madeira
Let's take a look at Idealista's website statistics to see how the long-term rental market is doing in Madeira.
By municipality, information is currently only available for Funchal. In July 2024, the average rental value was 14.1 euros per square meter, a decrease of 3.42% from May. Compared to July 2023, rental values have increased by 5.2%. In principle, this is a fairly modest annual rate in the Portuguese context.
Tourist rental properties in Madeira
Purchasing real estate in Madeira can not only open up prospects for comfortable living, but also become a strategically profitable investment in the tourism business. To understand how quickly such an investment can pay off, you can use modern analytical tools.
For example, we have the data on short-term rentals in Madeira provided by the All The Rooms service. It tracks all AirBnB properties and provides valuable information on the number of offers and the average rate per night in different parts of the archipelago. By studying this data, you will be able to identify the most profitable municipalities for short-term rentals.
The first column of the table shows the number of properties available for tourist rentals in each municipality. The second column shows the average cost of accommodation per night in these facilities between May 13 and August 13, 2024.
It is worth emphasizing that the data from All The Rooms brings a new perspective to our analysis, differing from the information provided by Idealista.pt and the National Institute of Statistics. While the previous sources focus on the average cost per square meter of a property, All The Rooms operates only on the average price per night. This service does not provide a breakdown by type of property (villas, apartments, rooms, etc.) or by their meter. In any case, the result is valuable information about how much property owners charge tourists per night in different parts of Madeira.
Most short-term rentals are concentrated in the municipality of Funchal, where 3,515 offers were found. However, despite this, the municipality of Calheta comes first in terms of average price per night (116 euros). Funchal comes only second (113 euros). And in third place is Ribeira Brava (111 euros).
This data can serve as a starting point for assessing the potential benefits of a tourist rental. However, in order to make a truly informed investment choice, it is better to consult a Madeira real estate agent, which can be done through our website. With their in-depth local knowledge, they will be able to uncover all the secrets of the archipelago and help you find the perfect property.
The most expensive and cheapest properties available in August 2024
Currently, Idealista.pt portal presents 2.290 houses available for sale. For the purpose of this review, we will focus only on already built properties that are in good condition and ready for immediate occupancy.
The most expensive houses in Madeira today
7.950.000 euros Villa on top of a mountain overlooking the sea and the port of Funchal. The house of 600 square meters includes four bedrooms, four bathrooms and is located on a plot of 20.000 square meters. The villa is fully furnished, in good condition. Indoor heated swimming pool and large garden. There are also three separate houses on the plot: a studio, a one-bedroom house and a two-bedroom house suitable for rent. Energy efficiency class C. Municipality of Funchal.
6.000.000 euros Two two-story homes on a 5,000 sq ft lot. Main house with 4 bedrooms and 3 bathrooms. The second house can be used as a maid's house. Laundry and storage are also located there. No energy efficiency certificates. Municipality of Funchal. We saw this house in the winter review for the same money and it is still for sale.
5.500.000 euros Restored 17th century manor house on a 1 hectare plot. 6 bedrooms, 8 bathrooms. Garage, swimming pool. Energy efficiency class E. Municipality of Funchal. This house was also featured in our review a year ago and is still unsold. Last quarter there were ads with identical photos, where the price was reduced to 5.000.000 euros and even to 4.500.000. But even these tricks did not help, as all these ads still exist.
Minimal prices on finished homes that, judging by the photos, are ready to move into
95.000 euros Small house, only 40 square meters with 1 bedroom and 1 bath in the countryside. There is a plot of 526 square meters. There is no energy efficiency certificate. The municipality of Porto Moniz. We saw it in the winter price review as well. Usually the cheapest properties leave the market quickly, but in this case clearly the price is not so attractive as it is discouraging other factors.
120.000 euros Two-story house with an area of 145 square meters. On the second floor there is a kitchen, living room, two bedrooms, bathroom and balcony. On the first floor there is a laundry room, a multipurpose room and a patio. The house was built in 1937, is in good condition and has mountain views. The plot size is 116 square meters. Energy efficiency class E. Municipality of São Vicente.
120.000 euros Rustic house with an area of 94 square meters. The house has two bedrooms, one bathroom, living room with open-plan kitchen and terrace with barbecue area. Good condition. The property is exempt from energy efficiency classification. Municipality of Porto Moniz.
135.000 euros The house is 144 square meters and overlooks the sea and the village. It has two bedrooms, one bathroom, kitchen, dining room and a terrace with sea view. On the upper floor there is a room with a separate entrance. There is the possibility to equip a parking space. Energy efficiency class D.
Let's take a look at the offers of T2 apartments (two bedrooms and living room) in Madeira available on Idealista.pt. From the 2.193 properties we will select only those that have real photos and are ready to move in immediately. We exclude apartments that require significant renovation or are for rent.
The most expensive apartments
1.200.000 euros Apartment in a new residential complex Savoy Residence. The total area is 177 square meters. The apartment includes two bedrooms with private bathrooms, as well as another bathroom. The kitchen is fully equipped, air conditioning and a smart home for controlling lights and curtains. On the roof of the building there are communal gardens, a solarium and infinity pool. Two parking spaces and a storage room are included. The complex offers 24-hour concierge and porter services, as well as access to the exclusive services of the Savoy Signature hotel chain. Energy efficiency class: B. Municipality of Funchal.
1.100.000 euros Apartment of 188 square meters. 2 bedrooms, 3 bathrooms. Terrace. 4th floor in a house with an elevator. The house is built in 2021. Garage included in the price. Energy efficiency class A. Municipality of Funchal. We saw this offer in last quarter's review.
995.000 euros Apartment of 200 square meters in a residential complex built in 2022. 2 bedrooms, 2 bathrooms. Large terrace. There is a garage for 2 cars. Access to the house is equipped for people with reduced mobility. Energy efficiency class A. Municipality of Funchal. We saw this one in the winter, and last year it was sold for more. The price reduction did not help, as it is still on the market.
The cheapest apartments
180.000 euros One-bedroom apartment with an area of 102 square meters. Includes a bedroom with en-suite bathroom, a second bedroom, living room, kitchen, laundry room and another bathroom. There is a balcony and a covered parking space. Built in 1998. Energy efficiency class C. Municipality of Santa Cruz.
195.000 euros The apartment is 71 square meters. 2 bedrooms and 1 bathroom. Balcony with sea view. There is a covered parking space and additional parking spaces on the street. The house was built in 2003. Energy efficiency class C. Municipality of Santa Cruz.
205.000 euros The apartment is 119 square meters. 2 bedrooms and 2 bathrooms, balcony with panoramic view. The price includes a covered parking space and additional storage room in the basement. The house was built in 2004, the apartment is in good condition. Energy efficiency class D. Municipality: Santa Cruz.
What can be said about the Madeira real estate market this summer to summarize
Madeira has seen some interesting trends in the real estate market, as statistics from Idealista.pt show. In the last 12 months, the average price per square meter in sellers' listings has increased significantly, while in tenants' listings it has decreased slightly.
However, let's focus on the real estate for sale. There are a lot of expensive properties on the market that have been without buyers for more than a year. At the same time, there are new offers in new luxury buildings, which are sold simultaneously through several agencies. It is not clear whether such a wide offer is backed up by solvent demand.
If we talk about the cheapest objects, they find their buyers faster than the elite ones. At the same time, price is not a determining factor. Buyers clearly want to get quality (acceptable space, location and condition of the object) for their money. At the same time, the lowest price threshold for cheap real estate objects has grown a lot over the last 3 months.
In addition, it is worth noting that the actual prices at which the deals are made turn out to be much lower than those indicated in the ads.
If you are considering buying a property in Madeira with a real estate agent, you can contact a professional real estate agent through our website to help you find the right property and secure the best possible deal.
Well, if you want to learn about mainland Portugal as well, go to the main page of our blog and choose the section of your interest!
