Algarve real estate market — prices, rental yield and trend

• Average price: $3,631 / m²
• Gross rental yield: 3.97%
• 12-month price change (USD): 4.79%
• Net rental yield: 3.57%
• Transaction cost: 11.2%
• Price basis: regional average

Residential property in Algarve averages $3,631 per square metre, +4.8% in dollar terms over the last twelve months. That makes it the 126th most expensive of the 264 markets in the set.

What a buyer pays in Algarve

The $3,631 figure is a regional average across all residential property types, which flattens a wide spread — the most sought-after areas run well above it, the rest of the region well below. Buying costs — transfer tax or stamp duty, notary, registration and agency — come to about 11.2% of the price here. On a 100 m² apartment at the average price that is roughly $40,667 on top of the $363,100 purchase price. That is above the 9.5% median across the set — the entry cost is part of the investment case here. Of that, the transfer tax alone is 1–8% depending on the buyer and the property; the rest is notary, registration and agency fees.

What it earns

A square metre lets for about $12.0 a month. Against a purchase price of $3,631 per square metre that is 4% gross, before tax. Both figures come from the same source and the same period, so you can check the arithmetic yourself. It ranks 244th of 311 markets by gross yield. Rental income is taxed at 10–25% — the rate is not a single number here. That is the difference between 3% and 3.6% net on the same property. The 3.6% net figure we publish uses 10%. On the way out there is a third tax: a non-resident seller pays 6.3–24% on the gain, depending on how long the property was held and who is selling.

How the tax works. 10% under the reduced rate for long-term residential lets (EBF art. 45-C, Decree-Law 97/2026, in force from 1 January 2026 to the end of 2029), which applies only while the rent is at or below €2,300 a month; above that threshold the standard 25% non-resident rate applies (CIRS art. 72). There is no flat expense allowance, so the statutory rate is the effective rate. The 10–25% band reflects that threshold, and the reduced rate has not yet been confirmed for non-residents by a tax-authority circular. Source: diariodarepublica.pt.

Who can buy in Algarve

Freehold, no restrictions. That is the rule a foreign buyer meets first, not legal advice — check the current position locally before you commit.

How this figure is built

The price figure for Algarve is built from recorded transaction prices. It was last refreshed on 2026-10-22. We rate our confidence in this market’s data high: the underlying series is official and current. We recompute every market the same way; a figure that fails our checks is suppressed, not guessed.

Sources: idealista.pt · api.frankfurter.dev. Snapshot: 2026-10-22.