Surprise Price Drops in Lisbon and Porto Put Homeownership Back in Reach

Even in a year when Portugal’s housing market set fresh records, a few unexpected corners of Lisbon and Porto have quietly become noticeably cheaper, creating rare openings for families who thought they were priced out of the big-city dream.

Where the bargains still live

Marvila’s industrial skyline may be dotted with cranes, yet the parish has seen a 16.9 % slide in closing prices over the 12 months to June, the sharpest fall registered anywhere in the capital. Areeiro followed with a 12.7 % drop, while across the Douro, Campanhã went down 8.5 %. The median tag in those three neighbourhoods now ranges between €2 819 / m² and €5 699 / m², well below the wider Lisbon mark of €4 525 / m² and Porto’s €3 060 / m². For households paid in euros rather than dollars or reais, that gap can shave tens of thousands off a mortgage.

What pushed prices down

Urban economists point to a cocktail of forces. The termination of Golden Visas linked to property, the sunset of the Non-Habitual Resident tax break and tighter lending as the Euribor hovered above 3 % all cooled speculative appetite. At the same time, the government’s Mais Habitação toolbox nudged developers toward fringe zones such as Marvila’s riverside or Campanhã’s Antas corridor, swelling supply just as cost-sensitive local buyers were bargaining harder. The outcome was pockets of genuine negotiation power in an otherwise inflationary market.

Areas still sprinting ahead

Price cooling in those three districts did not halt the capital’s overall climb. Beato surged 32.3 %, Campolide jumped 23.4 %, and seven Lisbon parishes now command above €5 000 / m². Santo António remains the city’s priciest address at €6 031 / m², even after a tiny adjustment. Porto tells a similar, if less dramatic, story: Lordelo do Ouro and Massarelos advanced 10.5 %, keeping the coastal union of Aldoar–Foz–Nevogilde on top at €3 836 / m² despite a small retreat.

Porto versus Lisbon: a gap that matters

The nominal spread between the two cities—roughly €1 500 / m²—masks deeper contrasts. Lisbon hosts nearly three times as many foreign-funded deals and concentrates corporate headquarters, which keeps demand resilient even when interest rates rise. Porto’s cheaper stock gives it a buffer against shocks, yet its rapid influx of tech jobs and student housing projects is closing the distance. Analysts at Confidencial Imobiliário note that half of the apartments listed below €648 000 nationwide are in Porto, a threshold that benefits from Portugal’s new 6 % construction VAT.

Looking forward: projects that may tilt the scales

If history is any guide, today’s discounts in Marvila and Campanhã could prove fleeting. Prata Riverside Village, the Marvila-Beato Urban Execution Zone and a 28-hectare lattice of new parks are set to add more than 2 700 flats east of Lisbon’s centre by 2027. In Porto, the €40 M Matadouro cultural hub, the €177 M Corujeira urban operation and schemes like Antas Atrium promise hundreds of new units and upgraded public space. Planners expect those investments to push both neighbourhoods toward the metropolitan average within three to five years.

What this means for Portuguese buyers

For residents earning local wages, the window of relative affordability in Marvila, Areeiro and Campanhã is open but narrowing. Mortgage costs remain high, yet rumours of European Central Bank rate cuts in late 2026 could reignite demand. House-hunters who can compromise on postcode prestige right now stand the best chance of securing space in districts likely to ride the next upswing in values. The message from agents on the ground is clear: 2025 may be remembered as the moment when Lisbon’s east and Porto’s east still felt within reach for middle-income families.