Housing rents in Portugal increased, on average, 7.4% from 2024 to 2025 — more than triple the legal update coefficient of 2.24% that landlords can apply to ongoing contracts in 2026.
This is revealed by the Aluseg Rent Index, which aggregates median rents by municipality, district, and typology based on 42,000 records (primary source: INE). This article summarizes the essentials and shows where rents have increased the most.
The essentials in 30 seconds
- Rents for new contracts increased by 7.4% between 2024 and 2025 — more than triple the legal coefficient of 2.24% applicable to ongoing contracts.
- 180 of the 206 municipalities (87%) rose above the legal limit; Vouzela (Viseu) leads with +52%.
- In 2026, 15 of the 24 urban municipalities are already pulling back compared to the previous quarter — but Lisbon continues to rise, now above €1,617 for a T2.
- If your rent only followed the legal coefficient, it may be well below the market rate — it is worth comparing it with the reference value from the market simulator.
The number that matters: 7.4% vs. 2.24%
There are two rent levels in Portugal, and they are diverging. Rents for ongoing contracts can only increase by the legal coefficient — 2.24% in 2026. Rents for new contracts, set freely in the market, increased by 7.4% in a single year.
The result is a ‘turnover premium’: a property re-rented to a new tenant yields significantly more than the same property with an old contract — one of the factors shaping landlords’ decisions and fueling the debate over the new rental regime.
The increase was across the board for all typologies: T0 and T1 at +7.5%, T2 at +7.4%, T3 at +7.3%.
2026 Update: cities begin to cool down
The latest data from the INE (1st quarter of 2026) brings news: after rising without pause throughout 2025, the urban market has shown its first sign of cooling down.
In the 24 urban municipalities analyzed, the median rent for a 2-bedroom apartment (T2) remains about 7.7% higher than in the same period of 2025 — but in 15 of those 24 municipalities, rent decreased compared to the previous quarter. Loures (−7%), Barcelos (−5.9%), and Cascais (−5.1%) lead the declines in the periphery.
The great exception is Lisbon, which bucks the trend and continues to rise: up 5.2% in the quarter alone, exceeding €1,617 for a 2-bedroom apartment (T2). The emerging pattern for 2026 is clear — rents have stopped rising (or are falling) in the outskirts of major metropolitan areas, while central Lisbon continues to push upwards.
See the full table of the 24 municipalities, with year-over-year and quarterly variations, in the Aluseg Rent Index.
Where rents increased the most
Growth was not driven by large cities — it was in the interior and medium-sized municipalities that the highest year-over-year increases for a 2-bedroom apartment (T2) were recorded:
- Vouzela (Viseu): +52% — from €362 to €551
- Amares (Braga): +33% — from €410 to €546
- Monchique (Faro): +28.9% — from €516 to €665
- Aljustrel (Beja): +28.1% — from €544 to €697
- Porto de Mós (Leiria): +25.1% — from €411 to €514
In total, 180 of the 206 municipalities analyzed (87%) increased above the legal limit of 2.24%. The most notable exception was Madeira, the only district to see a decrease (−4.9% for a T2).
Where renting continues to cost the most
At the top of the absolute values remain the usual suspects — but with moderate increases, a sign of a market that is already stretched: Lisbon (€1,491 for a 2-bedroom, +3%), Cascais (€1,358, +3.1%) and Funchal (€1,263, +3.4%). The major exception is Sines (€1,242, +13.1%), driven by demand linked to industrial and logistics investment.
The reading is clear: rent pressure is shifting from consolidated centers, which are already at their limit, to the periphery and the interior — precisely where many landlords still charge outdated rents.
What this means for you, the landlord
If you have a rented property, three practical conclusions:
- Your rent might be well below the market rate. If the contract is a few years old and you have only applied the legal coefficient, the difference compared to a new contract could be in the double digits. Check the reference value for your property on the Rental Market Simulator.
- You cannot simply raise the rent. For active contracts, the limit is the annual coefficient (2.24% in 2026), communicated in writing 30 days in advance — see how to do it. Convergence with the market only happens at the end of the contract or by mutual agreement.
- A new contract is an opportunity — and a risk. Higher rents attract applicants who stretch themselves financially to pay. Before signing, check the tenant’s solvency and formalize everything in an NRAU-compliant lease agreement.
View the complete data
The complete table by district, the 15 municipalities with the highest increase, and the analysis by typology are available in the Aluseg Rent Index, updated periodically. The data is free to use for editorial purposes with citation. City analyses: rental prices in Lisbon · median rent in Porto · Braga · Coimbra · Faro (Algarve).
Source: Aluseg Rent Index (INE, housing rents 2024 and 2025), 42,037 records. Values refer to T2 typology.
