Portugal recently emerged as a popular destination for expats and digital nomads, thanks to its affordable cost of living, beautiful landscapes, and rich cultural heritage. As a safe choice for tourism during troubled times, it quickly became an option for those looking for a dream lifestyle.
Whether you’re considering moving to Portugal for a temporary adventure or making it your permanent home, understanding the cost of living is crucial for planning your new life. Our comprehensive guide explores the expenses you can expect, from housing and groceries to transportation and healthcare.
Most importantly, these aren’t estimates. They are true numbers from our Portugal-based team. Some you’ll find impressive, others not so much, but will indeed allow you to have a clear picture of the cost of living in Portugal.
Housing
One of the primary considerations for anyone moving to Portugal is the cost of housing, which varies significantly depending on the location. In major cities like Lisbon and Porto, housing is more expensive, while smaller towns and rural areas offer more affordable options.
Affordable is a euphemism, as even these locations have started capitalizing on the shortage of houses in the market. It’s not uncommon to find houses that are now 3-4x more expensive than they were, let’s say, 5 years ago. But let’s crunch some of those numbers.
Apartments and Rentals
For a one-bedroom apartment in Lisbon, expect to pay over €1,200 for around 60 m². Studios typically range from €700 to €900 per month if you’re lucky, although they might feel cramped.
Rooms in shared homes go for around €600. In Porto, rents are slightly lower, with one-bedroom apartments costing over €1,000 for 60 m² and studios around €600 to €700. The Algarve region, known for its beautiful beaches, offers a similar price range for rentals. The offer is far from extensive, and the quality is so-so. You won’t be living in any sort of luxury for these values.
In less expensive areas, such as small villages or the interior regions, furnished rentals can start as low as $450 (€410) per month. For expats seeking luxury, private villas in cities like Cascais can cost around $3,100 (€2,832) per month, but you’re more likely to pay $5,000+.
Buying a Home
For those interested in buying a property in Portugal, prices vary greatly based on location. In Lisbon, apartments average around €21 per square meter, while in Porto, the average is €16.9 per square meter. These numbers keep going up, and available 2-bedroom flats can easily cost $200,000+. Again, we’re not aiming anywhere near luxury, just the very basic in a humble neighbourhood.
House prices have become Portugal’s most pungent issue, with very few solutions in sight. With the exponential increase of expats, the pressure in the market is now unbearable.
Utilities
Utilities for a two-person household in an 85 m² flat cost around €189 per month, including heating, electricity, and gas. For a smaller, 45 m² studio, expect to pay around €130 per month. Internet costs range from €34 to €65 per month.
Portugal’s main internet and TV operators are: MEO, Vodafone and NOS. In some areas, you find smaller companies with better prices. Internet is fast and reliable in most of the territory, although simple internet access packages are made to be more expensive so you get the “all in one” package instead.
Many houses still don’t have gas pipes and in rural areas, you need to either rely on old-fashioned options or go 100% electric. Electricity could be more expensive, with prices ranging €0,010 to €0,018 per kWh. Plus taxes, naturally!
Tap water is also a hit-and-miss, with each municipality charging as they please. A couple can spend €20/month in one location and the very same consumption costs €45+ in the next municipality. Finally, heating is extremely expensive in Portugal due to poor housing insulation.
Groceries
Grocery costs in Portugal are relatively affordable, although they can vary depending on where you shop. Our suggestion is to check some of the main supermarket chains online, such as Continente, Pingo Doce (Mercadão), Auchan, Mercadona. Here are some typical prices for common items:
- Milk (1 gallon): €3.52 or €1.80 per litre
- Loaf of fresh white bread (1 lb): €1.25
- Eggs (12): €2.73
- Local cheese (1 lb): €4.49
- Chicken fillets (1 lb): €3.11
- Apples (1 lb): €0.89
Overall, budget at least €100 per week for basic groceries per person. Inflation throughout 2024 has brought many of these prices up, with some items becoming excessively expensive.
Transportation
Portugal has a somewhat developed public transportation system, particularly in major cities like Lisbon and Porto. Monthly transport passes cost around €40 in both cities, allowing access to various public transport options. Taxi fares start at €3.50, and a one-way ticket on local transport costs around €1.98.
We’d like to see more options, particularly towards peripheral areas. As a result, many still opt for the car daily. Speaking of cars, they are excessively expensive compared to other European countries, with high running costs. Acquisition, in particular, is more expensive than Spain or Italy, for instance.
Healthcare
Portugal’s healthcare system is highly rated, with public healthcare being nearly free for residents. Private healthcare, on the other hand, is more expensive, with doctor’s appointments costing around €40 to €50 without insurance. Private health insurance varies from €400 to €1,000 annually, depending on the coverage.
The SNS – National Healthcare System – will take you in without charging, but it’s also important to understand that in recent years the service has suffered from a lack of resources. Expect it to be free, but don’t expect it to be excellent, as they can only do so much with what’s available.
Dining Out
Eating out in Portugal is a treat, but it’s essential to budget accordingly. In Lisbon, a meal at a mid-range restaurant without alcohol costs around €20, while in Porto, it costs around €15. These numbers have also been going up recently, with inflation taking a toll.
Yet, with €30/person you can find a very decent meal – wine included. Just look out for the dessert prices. We still admit eating out is acceptable in Portugal, with decent service and some very tasty options out there.
Cost of Living in Portugal vs USA, Germany, and UK
When comparing the cost of living in Portugal to other countries, it’s clear that Portugal offers significant savings:
- Cost of living in Portugal vs USA: Portugal is generally around 36.4% cheaper than the United States, with rent being 44% lower.
- Cost of living in Portugal vs Germany: Portugal’s cost of living is around 38% lower than Germany’s.
- Cost of living in Portugal vs UK: Portugal’s cost of living is about 37% lower than in the UK.
Entertainment and Leisure
Portugal offers various affordable leisure activities. For example, a fitness club membership costs around €35.90 per month, and a cinema ticket for an international release costs around €7.50. As you might be aware, the popcorn will be far more.
Theatre and musical shows can cost anywhere from €10 to €25, and Summer Music Festivals from €70 to €120. These attract some of the world’s best artists, and many take place within Lisbon and Porto, saving you a drive if you’re living in the city.
Small towns have evens all year long, and they’re usually great fun, with affordable food and drink.
Education
For families, education costs can vary. Public schools offer free basic education, while private schools cost between €400 and €500 per month. International schools, which teach in English, charge around €10,000/year. Public schools have been plagued by a lack of investment and successive strikes.
In our opinion, the Portuguese public education sector is obsolete and too reliant on public policy, along with excessive influence from unions.
Food for Thought
The cost of living in Portugal is generally lower than in many Western countries, making it an attractive option for expats, retirees, and digital nomads.
The affordability, combined with the country’s rich culture and beautiful landscapes, makes it a nearly ideal place to call home. Not without the downsides we’ve mentioned, and although there are some areas for savings, the costs of getting anything done and a proper home might make many think twice.
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