Why more British and Irish buyers are looking to invest in Portugal

Why more British and Irish buyers are looking to invest in Portugal

As someone who’s been involved in the real estate market here in Portugal, it’s impossible not to notice the increasing number of British and Irish buyers entering the market. Portugal has always been popular for its stunning landscapes, affordable cost of living, and great weather, but what we’re seeing now is an even bigger push, particularly after Brexit.

I’ve met several buyers who are looking for more than just a holiday home. They’re seeking a second life, a place to settle or invest in, and Portugal is ticking all the boxes. But why exactly are we seeing such a surge, and what does the future hold for these buyers?

Brexit and the search for stability

One of the main reasons for the rise in British buyers is the uncertainty caused by Brexit. Many Brits who might have considered other European countries before Brexit are now looking at Portugal for its stability and welcoming environment for expats. The property market here offers a great opportunity to invest in second homes or holiday homes, particularly in popular regions like the Algarve, Lisbon, and Porto.

These areas have become hotbeds for international buyers, and for good reason. Take the Algarve, for example, where house prices are still affordable compared to many other European coastal regions. The Algarve Property Market Report shows that property prices in this region are growing at an annual rate of around 10%.

For buyers coming from the UK, Portugal offers the peace of mind that comes with economic stability. Post-Brexit, there’s been a clear push for Brits to find their way back into the EU, and Portugal’s Non-Habitual Resident (NHR) tax regime makes that possible.

NHR Tax incentives: A clear pull

Portugal’s Non-Habitual Resident (NHR) tax program is incredibly appealing for both British and Irish buyers. This program offers significant tax benefits, particularly for retirees or those with foreign-sourced income. Under the NHR, foreign income such as pensions, dividends, or capital gains may be tax-exempt or taxed at reduced rates for a period of up to ten years. This program makes Portugal an attractive destination for those seeking not only a new lifestyle but also financial efficiency.

In my experience, the NHR program is particularly attractive for buyers looking for long-term stability and favorable tax conditions. It’s not just about making a good investment. There’s a sense of long-term security when moving to Portugal. Buyers want to know that they’re getting more than just a property; they’re investing in a lifestyle and a future within the EU.

Affordability and quality of life

For me, one of the standout features of Portugal is its high quality of life paired with affordability. Having traveled across much of Europe, I can confidently say that Portugal offers more for your money when it comes to property. Many British buyers I’ve met are shocked at how much further their budget can go here compared to back home.

Lisbon and Porto are seeing continued growth. Property prices in Lisbon increased by about 7% in 2023 alone, but compared to places like London or Dublin, Portugal’s capital still offers excellent value. Whether it’s the Algarve’s sunny coasts or the bustling city life of Lisbon and Porto, Portugal offers something for everyone.

But it’s not just about affordability. Portugal’s charm is undeniable. The laid-back lifestyle, low crime rates, and beautiful climate are constant draws. From a personal standpoint, I’ve always found that people here prioritize well-being, which is something that resonates deeply with many British and Irish buyers looking for a slower pace and a warmer climate. This is the type of lifestyle many are seeking when investing in properties here.

A new trend in residential design

One thing that’s changing in the real estate market is how homes are being designed to cater to remote work and hybrid lifestyles. I’ve seen several new residential projects that offer flexible home office spaces and enhanced connectivity. Given the rise in remote work post-pandemic, more buyers are looking for properties that can accommodate this new way of life. It’s no longer just about having a nice holiday home, it’s about finding a property that fits both leisure and work.

What this means for the future

From my perspective, the trend of British and Irish buyers flocking to Portugal isn’t going to slow down any time soon. Portugal has managed to strike a balance between affordability, lifestyle, and investment security, which will continue to attract buyers from abroad. The rising interest in remote work is also influencing how properties are designed, with many homes being built or adapted to offer workspace solutions.

For sellers and investors, the influx of international buyers represents a strong market, especially in prime areas like Lisbon and the Algarve. We’re already seeing property values rise in response to demand, and this growth shows no signs of stopping.

If you’re thinking about buying property in Portugal, now might be the perfect time to jump in before prices climb even higher. Whether you’re looking for a second home or a long-term investment, Portugal’s market offers a wealth of opportunities.

Reach out and we will help you find your next investment in Portugal.

Data from Portugal News