What Portuguese citizenship offers: why you should get a Portuguese passport

Portugal remains one of the most affordable destinations in Western Europe for both investment and living. Unlike Lisbon or Porto, there are dozens of cozy, underrated regions in the country where you can live comfortably without overpaying. Today we will look at the cities in Portugal for buying affordable housing, where developed infrastructure, low prices, and a decent standard of living are combined.

This choice is especially relevant for those planning to immigrate to Portugal inexpensively, work remotely, or establish a base for obtaining a residence permit on favorable terms.

Bragança — a northern fortress with affordable prices

Bragança is located in the northeast of the country and is among the quietest and most affordable cities in Portugal to live in. The average price per square meter is around 700–900 euros. You can rent an apartment here for 300–400 euros per month.

The area is surrounded by mountains and greenery, known for its tranquility and clean air. Bragança is suitable for those who appreciate seclusion and a moderate pace. Thanks to the university, many young people live here, and the level of infrastructure and transportation is sufficient for everyday comfort.

Castelo Branco — a central location between the capital and the border

The region, conveniently located between Lisbon and the border with Spain, always attracts interest due to its advantageous geography. Castelo Branco confidently ranks among the top five in searches for “cities in Portugal for buying affordable housing.” Here you can buy an apartment for 60–70 thousand euros, and the cost of individual houses starts from 90 thousand euros.

Living in Castelo Branco is characterized by low costs not only for housing but also for everyday needs. Local authorities are actively improving the city’s infrastructure, implementing special programs for family resettlement.

Viseu — a blend of traditions and convenience

Located in the northeast of the country, Viseu is a place with a rich history, wide streets, and comfortable conditions. Budget-friendly cities in Portugal for living rarely offer such infrastructure at such prices: the price per square meter is within 1000 euros.

Viseu stands out for its high level of safety, developed education system, and accessible healthcare. It attracts not only Portuguese from major centers but also foreigners looking to save money without sacrificing comfort.

Vila Real — a region on the hills with an affordable market

Vila Real is cozily situated in the north of Portugal, in the picturesque Trás-os-Montes region, offering housing at affordable prices starting from 700 euros per square meter. It is quite possible to buy a spacious house here at a cost lower than that of a compact studio in the country’s capital.

Cities in Portugal for buying affordable housing, including Vila Real, offer the opportunity for a comfortable move to Europe with minimal expenses. The area combines attractive nature, a peaceful atmosphere, well-developed roads, and proximity to renowned wineries.

Leiria — a university center with moderate prices

Leiria is a territory between Lisbon and Porto. The average cost of an apartment is 1000–1300 euros per square meter, but lower offers can be found, especially in the suburbs.

For young people and families, inexpensive immigration to Portugal is possible through such options. The presence of universities, a stable job market, and accessible transportation make Leiria attractive even on a limited budget.

Guarda — a high-altitude area with low prices

The highest located area in the country, surrounded by the Serra da Estrela mountains, attracts with its winters, tranquility, and economical living. Affordable cities in Portugal for relocation definitely include Guarda: here, you can buy a square meter for less than 800 euros.

The region is not overcrowded with tourists, and the local population is known for its hospitality. An excellent choice for retirees, introverts, freelancers, and families seeking minimal expenses.

Beja — a region with an Andalusian accent

Beja is the center of the agricultural region of Alentejo. The climate here is hot and dry, and the architecture resembles Andalusian towns. Real estate in Beja is affordable even for investors with limited funds: a house with a garden can be purchased for 70–90 thousand euros.

Cities in Portugal for buying affordable housing located in the southern part of the country offer a chance to move to a warm climate and avoid overpriced markets. Beja is one of those destinations that is gaining popularity among expats.

Évora — historical coziness with a Roman character

Évora attracts attention with deep cultural traditions dating back to the Roman era. Being included in the UNESCO World Heritage list has not affected its affordability. Living here is much cheaper than in popular resort cities in Portugal.

Budget-friendly cities in Portugal for living, including Évora, allow you to not just move but enjoy comfort without depriving yourself of the simplest pleasures. Spacious two-bedroom apartments here can be purchased for around 80–90 thousand euros.

Estremoz — market, marble, and tranquility

Estremoz is famous for its unique marble extraction, which has earned it the reputation of the “marble heart” of Portugal. The regional market of Estremoz is one of the most vibrant and atmospheric in the country.

At the same time, real estate in the city is surprisingly affordable. The cost of apartments and houses starts from just 50 thousand euros, making the city attractive for budget immigration.

Chaves — a thermal option for health

Chaves, located in the northeast of Portugal near the Spanish border, is famous for its thermal springs that attract people caring for their health. That’s why it regularly appears in rankings for “cities in Portugal for buying affordable housing.” The average price per square meter of housing here ranges from 800 to 1000 euros, and you can rent an apartment for a month for 250 euros.

Main reasons to choose affordable regions

Moving to the capital is expensive and stressful. Below is a list of reasons why it is worth considering less popular but promising destinations:

• minimal investment when buying;
• affordable rent, utility costs;
• peaceful life without crowds of tourists;
• high safety;
• good roads and public transportation;
• scenic landscapes and ecological environment.

This choice is especially relevant for retirees, freelancers, families with children, and investors looking for growth prospects.

Isn’t it time to choose a city in Portugal for buying affordable housing?

Many cities in Portugal for buying affordable housing offer a real alternative to overheated markets: tranquility, accessibility, good quality services, and minimal costs.

Choosing the right location allows you to start European life without budget pressure, with the possibility of maintaining comfort, health, and stability.

Portugal continues to attract investors from all over the world due to its favourable tax system, warm climate and stable property market. Purchasing a home in this country entitles you not only to a comfortable stay, but also to additional benefits with proper planning. Before buying, it is necessary to carefully study what property taxes Portugal imposes on residents and non-residents, as well as how to optimise the financial burden.

Portugal’s tax system: general principles

Portuguese tax legislation is governed by the Serviço de Finanças, which establishes compulsory payments for owners. The structure of the system includes both mandatory one-off contributions and annual fees depending on the characteristics of the property.

There are three main taxes to consider when purchasing a home:

1. IMT (Imposto Municipal sobre Transmissões Onerosas de Imóveis) – for property transfers, charged on purchase.
2. IMI (Municipal Property Tax) – ежегодный.
3. IS (Imposto de Selo) – stamp duty, which is paid when a transaction is concluded.

In addition to these fees, tax residency status affects the amount of mandatory deductions.

Buying a property in Portugal: taxes and additional costs

There are significant costs involved in formalising a property title. The first mandatory fee in Portugal is the IMT property transfer tax, which varies from 0% to 8% depending on the price of the property and its type. For example, when buying a property worth up to 92,407 euros, the fee is not charged, while for luxury apartments – over 1 million euros – the rate will be 7.5%.

Next is the stamp duty (IS), which is paid when signing the sale and purchase agreement. It is calculated as 0.8 per cent of the value of the property and is payable in a lump sum. In addition, it is necessary to take into account notary and registration fees, which can vary from 500 to 2,000 euros depending on the complexity of the transaction.

Annual property tax in Portugal (IMI)

Once contracted, owners are required to pay an annual fee known as IMI. Its rate is:

• 0.3% to 0.45% for urban facilities,
• 0.8 per cent for agricultural land,
• 7.5% for real estate registered in offshore jurisdictions.

The amount of tax is based on the cadastral value, not the market price of the property. For example, if you own a flat in Lisbon with a price of 200,000 euros, the annual fee will be between 600 and 900 euros. There is a benefit for new residents: exemption from IMI for 3 years for dwellings up to 125,000 euros if they are used as a primary residence.

Portugal’s exceptional tax regime: NHR programme

To attract foreign capital, the government has developed the NHR (Non-Habitual Resident) system to minimise the tax burden on income earned abroad.

The main benefits are:

1. 0% inheritance and gift tax on real estate in Portugal for immediate family members,
2. 10% commission on pension payments,
3. 20% levy on income from the activities of highly qualified professionals (e.g. IT, finance, medicine).

NHR status is granted for 10 years, after which the commitment is reviewed.

Property taxes for non-residents in Portugal: features and key rates

Foreign investors acquiring property in the country face different tax conditions than local residents. Taxation varies depending on the nature of ownership of the property – rental, sale or long-term ownership without income. The main liabilities include tax on rental income, capital gains on sale and annual property tax (IMI).

Charge on rental income: 28% of profit received

If the property is rented out, a non-resident of Portugal is liable to pay 28% tax on rental income. The amount is charged on the net income after deducting allowable expenses, which include:

1. Utility bills (if paid by the landlord).
2. Housing maintenance and repair costs.
3. Fees to management companies (if the property is rented through an agency).

For example, if you rent a flat in Lisbon for €1,500 per month (€18,000 per year) and have allowable expenses of €3,000, your taxable income would be €15,000 and tax would be €4,200. There are no progressive tax rates for non-residents, so optimisation of payments is only possible through proper cost accounting or registering the property through a legal entity.

Capital Gains Tax: 28% of the difference between purchase and sale

When selling property, non-residents are required to pay a commission, which is calculated as the difference between the purchase and sale price less allowable expenses.

Example of calculation:

1. The original cost of the flat is 300,000 euros.
2. The selling price is €450,000.
3. Costs for renovation and legalisation of the transaction – 20 000 euros.
4. The taxable base is EUR 130 000 (450 000 – 300 000 – 20 000).
5. The final tax is €36,400 (28% of 130,000).

Residents of the country can reduce the tax burden if they reinvest in new housing, but there is no such benefit for foreign investors.

Tax liability that arises each year

The fee is charged annually and is calculated on the basis of the cadastral value of the object.

IMI rates depend on the location of the dwelling:

1. For urban properties, 0.3%-0.45%.
2. For agricultural plots, 0.8 per cent.
3. For objects registered in offshore jurisdictions – 7.5%.

For example, if the cadastral value of a flat is €250,000, the IMI would be €750-1,125. The authorities of some municipalities provide incentives to new owners, exempting them from paying the commission for 3 years, but this rule does not apply to non-residents.

Investing in real estate: benefits for investors

Portugal continues to attract foreign investors due to sustained growth in property prices, strong rental demand and favourable tax conditions:

1. High rental demand. The country’s main cities of Lisbon, Porto and the Algarve remain popular with tourists and expats, keeping rental demand strong. In central Lisbon, the average rental rate for a one-bedroom flat is €1,500-2,000 per month, giving an annual yield of 6-10%.
2. Golden Visa Programme. Investors purchasing property in the country for an amount of 500,000 euros or more (or from 280,000 euros in regions with low population density) can apply for the Golden Visa – a residence permit with the possibility of obtaining citizenship after 5 years.

Results

Foreign investors planning to buy property should take into account the peculiarities of taxes in Portugal. Commissions for non-residents in the country are higher than for residents, but competent use of preferential regimes allows to minimise costs. Optimisation of tax liabilities requires a professional approach and planning, so it is recommended to consult with lawyers and qualified specialists before buying.