The 17 finest up-and-coming villages to relocate to in Portugal

With its sunny climate, friendly communities and low cost of living, Portugal is becoming increasingly popular among Britons looking to emigrate overseas.

Properties can be significantly cheaper in Portugal too, both for buyers and renters. Rent in Portugal is, on average, 22% lower than in the UK, according to numbeo.com, while Portuguese property prices remain significantly cheaper.

And while the most well-known areas of the country may have reached peak potential, there are plenty of lesser-known towns and villages with untapped property potential.

We’ve consulted property experts and estate agents to identify 18 of the best up-and-coming areas in Portugal to invest in now, where house prices have most potential to rise.

Ansião, Estremadura

Set in central Portugal, Ansião is a charming town known for its welcoming community and rich historical heritage, including ancient Roman roads and picturesque churches such as Igreja Matriz de Ansião.

‘Surrounded by lush landscapes, Ansião offers great opportunities for nature walks, cycling, and exploring nearby natural wonders such as the Serra de Sicó hills,’ says says Paul Stubbs at PPProperty. ‘It is also a great place to experience local traditions, cuisine, and the relaxed pace of life in the Portuguese countryside.’

Average price (all prices are for three-bed properties): €275,000/£232,000

On the market: This two-bed bungalow is surrounded by countryside yet just 10 minutes to town and all the amenities you need. It would make a great holiday or family home. €150,000 with PPProperty.

Sertã, Beira Baixa

Situated in the largest forest area in Europe, Sertã is a beautiful village in central Portugal surrounded by rivers and lagoons and has several festivals during the summer when the streets fill with people and bonfires. The village is a great option for those seeking both value and a peaceful lifestyle.

‘It is an attractive village with plenty of historical charm,’ says Clare Monson, Director of Pure Portugal. ‘Known for its rivers, forests, and traditional architecture, Sertã is gaining popularity as an affordable alternative to more established areas. It offers a blend of tranquility and convenience, with good proximity to larger towns.

Average price: €125,000/£105,000

On the market: This spacious two-storey four-bed house has a sizeable garden and lovely views. There are several river beaches nearby. €260,000/£219,000 with Pure Portugal.

Mexihoeira Grande, Algarve 

The largest of the three parishes comprising the municipality of Portimão in western Algarve, Mexihoeira Grande is a quaint village (population 4,000) located between Lagos and Portimao where traditions are kept alive, with most villagers working in agriculture. There are three international schools close by, as well as Faro airport, which is a 45-minute drive away. The Algarve’s beautiful beaches are just a few miles away.

‘It is known for its serene rural atmosphere, traditional architecture and rich historical heritage,’ says Georgie Westmoreland, Sales Manager at B&P Real Estate Agency. ‘The area is characterised by whitewashed houses, narrow streets and a peaceful countryside setting.’

Average price: €700,000/£590,000

On the market: This two-bedroom villa for completion in early 2025 is situated within the 4-star Breeze International Resort development. €645,000/£544,000 with B&P Real Estate Agency.

Carvoeiro, Algarve 

With a beach worthy of a guidebook cover, along with a welcoming, family-friendly vibe, Carvoeiro has lots to offer British expats. Packed with character and charm, the town, which has a population of just 3,000, features traditional Portuguese architecture and dozens of cafes and restaurants for enjoying the local seafood. It’s also well located for major Algarve attractions such as Zoo Marine and Aquashow, the largest waterpark in Portugal, while the local area also offers plenty of hiking and cycling trails.

‘Carvoeiro is the perfect spot for a family-friendly relocation to Portugal,’ says Alda Filipe, Real Estate Director, Kronos Homes. ‘It’s packed with shops, , leisure venues, banks, healthcare services and more, with the closest international school less than 15 minutes’ drive away. It’s bustling without feeling too busy, as well as being home to a picture-perfect beach.’

Average price: €380,000/£320,000

On the market: The one- to three-bedroom apartments at Monte Santo Resort start from €279,000 fully furnished, key-ready. From Kronos Homes.

Tomar, Ribatejo 

With its blend of historical landmarks, strong expat community, plenty of greenery and a peaceful riverside setting, Tomar city (population 40,000) is worth considering.

‘Tomar is a charming city known for its rich history and stunning architecture, including the UNESCO-listed Convent of Christ, a former Templar stronghold,’ says Paul Stubbs, team leader for PPProperty. ‘The city offers picturesque streets, beautiful gardens, and vibrant festivals that capture the essence of Portuguese culture.’

Average price: €300,000/£253,000

On the market: This three-bed 1980s countryside villa boasts panoramic views. €180,000 with PPProperty.

Pedrógão Grande, Estremadura

Situated in central Portugal, Pedrógão Grande town (population 4,000) has an attractive historic centre and is surrounded by forests and rivers, perfect for indulging in water sports or hiking amongst beautiful nature.

‘Pedrógão Grande is becoming an attractive destination for property buyers due to its affordability,’ says Clare Monson, Director of Pure Portugal. ‘It is a charming and lesser-known town that offers tranquillity and scenic beauty. It’s ideal for nature lovers and those seeking a peaceful lifestyle.’

Average price: €110,000/£93,000

On the market: This three-bedroom rural house is in good condition with a large, established garden with fruit trees. €80,000/£67,000 with Pure Portugal.

CASE80: Detached House

 

 

Braga and Guimarães, Minho

North of Porto in the interior of the country, the cities of Braga and Guimarães both have a rich history. Braga is a university city, one of Portugal’s oldest, and is home to the country’s oldest cathedral, dating from the 12th century. Guimarães, meanwhile, slightly south of Braga, is known for its beautiful well-preserved medieval buildings, including its 10th-century castle.

‘There are plenty of villas and restored quintas with good proximity to infrastructure and views to mountains or the sea,’ says Christopher Diener, Licence Partner at Engel & Völkers Braga-Guimarães. ‘The region around Esposende and the north coast, as well as the backcountry of Braga (Póvoa de Lanhoso, Vila Verde and Terras de Bouro) and Guimarães (Vieira do Minho, Fafe and Celorico de Basto) are good to focus on.’

Average price: €200,000/£168,000

On the market: This two-storey, two-bedroom house in a quiet area a 15-minute drive west of Braga at Gamil E Midões needs restoration, hence the fab price. €45,000/£38,000 with IAD Portugal.

https://www.iadportugal.pt/en/ad/housevilla-sale-2-bedrooms-gamil-e-midoes-78m2/r71952

 

 

Sagres, Algarve

Sagres is a small coastal town known for its dramatic cliffs, rugged coastline, and rich maritime history. Situated on the southwestern tip of Europe, it is part of the larger Cape St. Vincent area, which has long been considered the ‘end of the world’ due to its location at the edge of the continent.

‘Although a well-known place, the town has been transformed in recent years to a vibrant holiday destination,’ says Georgie Westmoreland, Sales Manager at B&P Real Estate Agency. ‘Still off the beaten track for many but becoming a real family favourite.’

Average price: €400,000/£337,000

On the market: This two-bedroom villa is less than a 15-minute walk from the beautiful beaches of Mareta and Tonel. It is possible to add another level to the property or split the living area to create a third bedroom. €695,000/£586,000 with B&P Real Estate Agency.

https://bpaproperty.com/en/property?id=5404&reference=BPA5536

 

 

Porches, Algarve

Buying a property in the charming village of Porches offers a peaceful slice of Algarve life, where stunning coastal scenery meets traditional Portuguese culture.

‘With its sunny climate, renowned local wines and pottery, and close proximity to some of the Algarve’s finest beaches like Praia da Marinha, Porches provides an ideal retreat for UK citizens seeking both relaxation and investment in one of Europe’s most sought-after regions,’ says Ideal Homes Portugal Senior Property Consultant Sasha Sharpley.

Average price: €585,000/£494,000

On the market: This swish studio at a new development is just a 10-minute walk from lovely beaches. €315,000/£266,000 with Ideal Homes Portugal.

Alcochete, Estremadura

The town of Alcochete, just outside, Lisbon, is ideal for those looking to live or work close to Lisbon, buy at a much cheaper price, and also escape the stress of the city. Home to the Tagus Estuary Nature Reserve, it has great ecological and rural appeal.

‘Alcochete is gaining attention due to the possible construction of a new airport, placing it in a strategic position,’ says Catarina Alves of Savills Portugal. ‘Modernisation of the transport infrastructure and its ability to attract investments could transform Alcochete into an important urban and tourist hub.’

Average price: €620,000/£523,000

On the market: A three-bedroom apartment at the swanky Tagus Bay development enjoys 24-hour concierge, gardens, three saltwater swimming pools, a spa, gym, kids club, lounge and library. €913,000/£771,000 with Savills.

 

Monchique, Algarve 

The village of Monchique, in the Algarve’s inland mountainous region, offers a peaceful escape from the more crowded coastal areas. Its colourful houses, cobbled streets and 16th-century church give it much charm. An ideal area for hiking and biking, there’s a natural spa, and a small theme park, Parque da Mina, to keep the children entertained.

‘Known for its natural beauty, thermal springs, and lush landscapes, Monchique is an ideal location for those seeking tranquillity,’ says Clare Monson, Director of Pure Portugal. ‘The village is surrounded by the Serra de Monchique mountain range, providing opportunities for outdoor activities like hiking. It is an appealing option for those looking for a quieter, nature-filled lifestyle in southern Portugal.’

Average price: €200,000/£168,000

On the market: Recently renovated, Marmelete House has a studio, one-bed and two-bed apartment and is licensed as a guest house, but could alternatively provide a home plus a granny flat and guest accommodation. €318,500/£268,000 with Pure Portugal.

Carrapateira, Algarve

Carrapateira is a hidden gem around 80 minutes’ drive from Faro Airport. It is a laidback coastal village with authentic white-washed buildings and a beautiful beach, Bordeira, which is just a 1-minute walk away. Amado beach, known for its surfing, is a seven-minute drive away.

‘This area is a surfer’s paradise but it’s extremely hard to find or build new properties here as Carrapateira is part of the Costa Vicentina, a sprawling natural park of nearly 900 km² that is home to protected plant species,’ says Lloyd Hughes od Athena Advisers. It makes anything new in this area a rare commodity and highly rentable.’

Average price: €900,000/£760,000

On the market: One-bed apartments at this new-build development are perfect for rentals. From €364000-€440,000 with Athena Advisers.

Loulé, Algarve

While increasing numbers are relocating to the Algarve, the hills behind are becoming more popular with those seeking space, affordability and Portuguese authenticity. The town of Loulé is located here, and offers a seamless blend of cultural vibrancy and traditional Portuguese appeal. Famous for its bustling markets, historic sites like the 13th-century castle, and lively annual carnival, the town is now a top choice for families and expats. Loulé’s charm lies in its balance between old-world heritage and modern conveniences, making it ideal for those seeking both authenticity and comfort.

‘Its central location, close to the coast and countryside, provides a perfect setting for a dynamic lifestyle,’ says Alasdair Hedley, Head of International at John D Wood & Co. ‘Additionally, proximity to luxury destinations like Quinta do Lago and Vale do Lobo, with their world-class golf courses and stunning landscapes, further enhances Loulé’s attraction, solidifying it as a prime area for relocation and investment.

This mix of rich history, luxury, and convenience sets Loulé apart as a thriving community, perfect for anyone seeking a refined yet culturally immersive experience.’

Average price: €350,000/£295,000

On the market: This two-bed house has land but needs renovation, hence the keen price. €120,000/£101,000 with Keller Williams Portugal.

Góis, Beira Litoral

Located in the Coimbra district, four slate villages comprise the municipality of Góis. It remains affordable, with average prices for a three-bedroom home ranging from €70,000 to €150,000, depending on location and property condition.

‘It offers a peaceful and scenic lifestyle with its mountains, rivers, and charming traditional homes,’ says Clare Monson, Director of Pure Portugal. ‘Known for its outdoor activities and annual motorbike festival, Góis is attracting more attention. It’s an excellent choice for those seeking a rural retreat with investment potential in central Portugal.’

Average price: €110,000/£93,000

On the market: This seven-bed house has scope for more bedrooms on an upper storey and boasts an above-ground swimming pool, a mature garden, three terraces and a covered courtyard. €199,950 with Pure Portugal.

 Tavira, Algarve

Located only 25 miles from Faro’s airport in eastern Algarve, this quiet, historical town (population 27,000) is much more affordable than the more traditional properties of central Algarve.

‘We are seeing increasing number of clients seeking the quiet authenticity of the area and especially the open countryside surrounding the town,’ says Alex Koch de Gooreynd, Partner at Knight Frank. ‘Tavira is one of the Algarve’s hidden gems. This pretty town offers picturesque plazas stuffed full of cafes, and cobbled streets with a unique blend of traditional architecture with Moorish influences.’

Average price: €300,000/£253,000

On the market: This bright studio in a development has three pools, a spa, gym, restaurant, bars, kid’s club and direct access to the beach. €140,000/£118,000 with IAD Portugal.

 Salema, Algarve

The traditional fishing village of Salema, in the western Algarve, is just a few kilometers from the picturesque city of Lagos. It boasts a long, curved stretch of sandy beach, traditional whitewashed homes, plenty of greenery all around and enticing family-run restaurants. Yet the village has an air of tranquillity, even in the height of summer, making it the ideal spot for those seeking a home or investment property away from the crowds.

‘As a popular tourist destination, the Algarve can be busy over the summer months, but Salema balances that with a serenity all of its own,’ says Alda Filipe, Real Estate Director, Kronos Homes. ‘The village feels like a peaceful, protected pocket of Portugal, yet it’s only a little over an hour from Faro Airport. It’s secluded but connected.’

Average price: €460,000/£387,000

On the market: Salema Beach Village has two- and three-bedroom villas centered around a scenic swimming pool and is nestled on a hillside sloping down towards the beach just 500 metres away. All villas are sold fully furnished and equipped, making them ideal for investors or families looking for an easy move. From €340,000/£286,000 with Kronos Homes.

Oliveira do Hospital, Beira Litoral

Located in the foothills of the Serra da Estrela mountains, Oliveira do Hospital village has a great blend of rural charm and growing infrastructure that makes it an attractive destination for those seeking a peaceful life in Portugal. It has a rich culture with Roman settlements, Neolithic and Bronze Age burial grounds and Gothic mansions.

‘Oliveira do Hospital offers beautiful landscapes, rich history, and is close to nature reserves,’ says Clare Monson, Director of Pure Portugal. ‘The village is becoming increasingly popular with international buyers due to its affordability and peaceful lifestyle.’

Average price: €150,000/£126,000

On the market: With 12 rooms, a roof terrace, outdoor terrace with BBQ and plenty of land, this property would be perfect for a large family or perhaps a tourism venture. €330,000 with Pure Portugal.

Alvaiazere, Estremadura

Known for its tranquil atmosphere and scenic landscapes filled with rolling hills and olive groves, Alvaiázere is a quaint market town in central Portugal.

‘It offers visitors a taste of authentic rural Portuguese life, it is ridiculously well equipped for a town of its size, with sports facilities, stadium and indoor and outdoor swimming pools,’ says Paul Stubbs at PPProperty. ‘Alvaiázere is also a gateway to nature trails and outdoor activities, perfect for those looking to explore the natural beauty of the region.

Average price: €275,000/£232,000

On the market: This detached four-bed house has an established garden with fruit, avocado, and olive trees and is within walking distance of cafes and restaurants. €215,000/£181,000 with PPProperty.

What it really costs to move to Portugal: Your pension and savings go a LOT further – and you’ll pay less tax

By Liz Rowlinson  

With a career in the Royal Navy and the Ministry of Defence, Peter Reynolds and his wife Karen were used to moving house. While Peter hails from Scotland, the couple lived in Portsmouth and Eastleigh with postings to Hong Kong and Gibraltar.

And when it came to retiring, they knew they wanted to settle abroad. After many happy holidays in Portugal’s Albufeira, they found a rustic property 15 minutes inland of the Algarve’s biggest tourism resort.

One of the advantages is that in the restaurants of their village, Cerro do Roque, they are typically surrounded by local workers rather than tourists.

When they tuck into bread and olives, followed by piri piri chicken or pork and clams washed down with a beer or a glass of local vinho verde, that menu do dia (menu of the day) costs just €10-12.

In 2022, the couple fell in love with a four-bedroom quinta – or rural house – with a small swimming pool surrounded by a large garden of fig, almond lemon and loquats trees that they bought for €330,000 (£278,000), less than they received for the sale of their four-bedroom house in Eastleigh, Hampshire.

‘Peter’s pensions and our savings go a lot further than they would back in Hampshire,’ says 64-year-old Karen, who used to run the family hair and beauty salon, Classic Cuts. ‘We definitely have a very comfortable life here.’

In fact, along with the sunshine and a more relaxing lifestyle, the affordability of living in Portugal remains a big driver for retirees across Europe. In the past decade, Portugal’s population of foreign retirees has more than doubled, with British expats accounting for 19 per cent of it, according to the Portuguese Statistics Department, ProData.

It also helps that Portugal is one of the safest countries in the world – rated 7th best in the 2024 Global Peace Index, the highest in southern Europe – and last year there were 45,218 UK citizens living there, nearly three times the number in 2013, according to the Portuguese border and immigration authority. 

The cost of living in Portugal is 37.5 per cent lower than in the UK, when food and everyday expenses such as transport and utility bills are compared, according to Numbeo.com.

Housing is not included in the calculation, and property prices in Portugal held up more strongly than many Eurozone locations in 2023 – up 7.8 per cent, year on year, according to Eurostat. The popular Algarve is relatively expensive compared to the country’s interior, with the average property in Portugal costing around €150,000 (£126,867), according to Idealista.com. 

In contrast, the average price of a detached house in Eastleigh sold in March 2024 was £533,000, according to the Office for National Statistics. But it is on annual property tax where there’s a real cost saving. In Eastleigh, the average (Band D) council tax is £2,137 per year – on Peter and Karen’s house it’s €167 (£141). 

Although it doesn’t apply to the Reynolds’ property, for homes worth more than €600,000 there is also an additional property or AIMI tax at 0.7 per cent of its value, but a couple can ‘pool’ their allowance so the tax is only payable on properties worth €1.2 million or more.

In the UK, the sum of £43,100 is required for a pensioner to enjoy a comfortable retirement, according to The Pensions and Lifetime Savings Association (PLSA), or £31,300 a year for a ‘moderate’ lifestyle. In Portugal, retirees can live comfortably on €1,300 to €1,500 per month – €15,600 (£13,147) to €18,000 (£15,168) a year – according to relocation advisory company Global Citizen Solutions.

At 67, Peter benefits from a full UK state pension (£221 per week) plus his index-linked naval pension and a Ministry of Defence pension from his career in the Royal Navy. It was when he was posted to Gibraltar that the couple first began to drive up to Albufeira for holidays.

Portugal has not been immune from food and fuel inflation. The cost of the Reynolds’ weekly food shop is around €80 to €100 a week – a little lower than what it would be in the UK. But it’s the fact that the couple don’t have to pay for healthcare that is a huge bonus – once they became resident they were able to register for the health service, or SNS, which (unlike the Spanish equivalent) they don’t need to pay into.

 The couple’s household bills are very low too. Karen says they pay €70 a month for water, €60-80 for electricity and around €40 a month for gas bottles as they are not on mains gas. The wholesale cost of electricity in Portugal in April 2024 was at its lowest point in more than five years, according to Statista. 

The Reynolds’ TV, phone and mobile package is €60 per month, and their home insurance just €120 (£103) a year – half the current UK average of £212 per year, according to Go.Compare. It’s also cheaper to run a car in Portugal, says Karen.

Insurance is €300 (£254) per year – including breakdown cover – and tax €120 (£101). The MOT (or IPO) is €35 (£30) after the fourth year of ownership from new, then every two years.

Peter can already take advantage of OAP discounts. Over-65s get half-price train and bus fares, plus the same (or sometimes free entry) to museums, along with lower rates at swimming pools and sports centres.

Cost-conscious retirees avoid the tourist hot spots, says Karen. ‘In a local cafe we pay around €2.50 for coffee and a cake – such as the typical custard-tart accompaniment, pastel de nata. If you go into Albufeira that might be €7.50.’

The same applies to a glass of wine or beer. ‘We tend to pay €1-€2 for a beer locally, and although it might cost €3.50 for a large glass of wine – half the UK price – it’s more common that we sit in the garden with friends and enjoy a decent bottle from the supermarket for between €2 and €5.’

Peter and Karen hope to enjoy many more years in their new Portuguese home. With it being reported this week that southern Europeans will become the longest living people in the world, they’ve settled in the right place.

‘We love pottering in the garden, heading to the beach, especially the long sandy sweep of Praia de Gale, or walking around the marina at Vilamoura. But we do miss our friends and family in the UK,’ says Karen.

The couple have two daughters and six grandchildren, the oldest of whom is 24. ‘They do visit and it’s a wonderful big garden where we can entertain and they love the pool,’ she says. ‘Our day-to-day life is good here, it’s a much better way of living than we’d have had back home.’

All you need to know about tax

Retirees should start planning early for a move. The Portuguese tax year runs from January 1 to December 31. For new arrivals, Portugal has introduced a split year for residency purposes.

Income derived from government pensions – nurses, teachers, firemen etc – will continue to be taxed in the UK and then the Double Taxation Agreement (DTA) is applied in Portugal so you are not taxed twice. State and private pensions will be taxed in Portugal.

For 15 years the NHR (Non-Habitual Residency) regime was an extra draw for wealthy retirees because it taxed pension income at a flat rate of 20 per cent for a 10-year period.

Now the beneficial rate has been removed, pensions are taxed at a progressive income tax rate that starts at 13.25 per cent on the first €7,703 of income and rises through to a top rate of 48 per cent on income of €82,000 or more.

An additional solidarity tax is payable by those on higher incomes – current rates are 2.5 per cent on income between €82,000 and €250,000, and 5 per cent above that.

Investment income (interest, dividends, rental income, capital gains) is taxed at a flat rate of 28 per cent, or can be added to the taxpayer’s other income and taxed at the scale rates. 

‘Married couples resident in Portugal can be taxable on the aggregate income of husband, wife and dependent children or can choose to be taxed individually,’ says Jason Porter, of Blevins Franks, a cross-border wealth advisory service.

Mr Porter says retirees should also bear in mind that UK tax-efficient investments such as Isas and Premium Bond winnings are likely to be taxed in Portugal.

Gains on the sale of real estate – except the main home – are taxable if the property was acquired since 1989. For Portuguese residents, only 50 per cent of the gain is taxable.

Beware that if you sell your UK home after you become tax resident in Portugal, you could be subject to capital gains tax there. If someone with €30,000 income has a capital gain of £500,000 on their UK home, the tax due could be €118,556 (£100,000), according to a calculation by Blevins Franks.

Inheritance and gifts tax have been abolished in Portugal, but a stamp duty of 10 per cent applies on the transfer of assets – houses, cars etc – located in Portugal upon death.

Brexit visa rules for Britons

Post-Brexit rules mean the only way you can legally stay in Portugal for more than 90 out of 180 days is to get a D7 visa, unless you can trace some Irish or other EU family roots to apply for an EU passport, or are married to someone with one – in which case you can apply for residency as their dependent.

The D7 is the obvious route, and Peter and Karen say it is fairly easy to obtain. You are required to show you will not be a financial burden by proving passive sources of income of at least €9,840 (£8,328) per year for a single person, or €14,760 (£12,492) for a married couple.

The visa is applied for in the UK from the Portuguese Consulates in London or Manchester.

Income sources are assessed on a case-by-case basis, says Paula Meireles, a lawyer in the Algarve. ‘The consulates will accept savings, but their preference is for pensions or other sources on ongoing income.’

When arriving in Portugal you must have travel health insurance but then register on the SNS – the equivalent of the NHS. You do not need private cover once you are established.

The visa application costs around €200, plus legal/translation fees. A D7 residence permit is granted for two years, then can be renewed for three years.

After five years of legal residency, you can apply for permanent residency or citizenship.

The D7 assumes those relocating will become tax resident in Portugal, which automatically happens if you spend more than 183 days in the country.