45% of housebuyers are foreigners

.. and 37% of prospective renters

45% of housebuyers are foreigners in Madera
Funchal, where 45% of housebuyers are foreigners

According to the most recent Idealista study, 45% of those who looked for a house to buy in Funchal in the last quarter of 2023 were foreigners, in addition to the fact that in the rental market, 37% of those interested in renting a house were also foreigners. These percentages, despite the quarterly and year-on-year decrease, are the highest of the 20 district capitals/autonomous regions in Portugal.

According to that online portal, “the last few months have been marked by profound changes in tax incentives for foreign citizens in Portugal: golden visas for real estate investment ended in October and the regime for Non-Habitual Residents (RNH), under the old terms, ended in 2024”, they recall. Thus, “they announced end of these tax benefits coincides with a drop in international demand from housebuyers at the end of 2023, especially by North Americans”, highlights Idealista. And he adds: “And, in the same period, there was also a decrease in foreign interest in renting a house in Portugal, as data from Idealista/data suggest. But, despite this lower attraction, foreigners continue to represent more than 22% of the total demand for houses to buy and rent in our country.”

Funchal is well above the national average

Clearly, therefore, Funchal is well above the national average, and the Diario breaks it down in parts:

“Demand from foreigners now weighs 23.1% on the total in the last quarter of 2023, against the 24.3% recorded in the previous quarter (-1.2 percentage points)”, he emphasizes with regard to home purchases, although in Funchal it increased by 1%, one of the three cities to grow along with Portalegre (+1.1%) and Castelo Branco (+0.9%). “In year-on-year terms, there was a decrease in interest in 11 large cities”, including Funchal with -1.7%, the seventh biggest drop in 20 cities.

As for houses for rent, “the weight of demand from foreigners ended the year representing 22.2% of the total, the lowest value since mid-2021”, with the Madeiran capital more than double that percentage. “This percentage is, therefore, lower than that recorded in the previous quarter (23.6%), as well as in the same period last year (29.7%). It should also be noted that the demand for foreigners in the rental market fell in all the capitals of district in year-on-year terms”, reinforces Idealista, and in Funchal it fell 4.4% year-on-year (the 7th least intense) and fell 1.2% in quarterly terms (the 12th most intense drop).

Idealista summarizes: “What also stands out is that, at the end of 2023, there were four cities where at least three in every 10 people who looked for houses to buy were foreigners. This was the case of Funchal (45.3% ), Ponta Delgada (40.1%), Faro (32.7%) and Viana do Castelo (31.1%). Évora, Coimbra and Beja were the cities least researched by families residing outside the country.(.. .) It was Funchal, Bragança and Viana do Castelo that most attracted foreign families to rent a home at the end of last year. And Évora, Santarém and Portalegre were the ones that aroused the least interest to these households.”

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9 thoughts on “45% of housebuyers are foreigners”

  1. Canada 🇨🇦 stopped home sales to non citizens two years ago to slow foreign speculation’s and increase availability to locals. Maybe time for Madeira to consider this move.

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  2. The world is now one big country, people move all over it, now can we know what is meant by ” FOREIGNERS” please, is it anyone from outside the EU or is it anyone not Madeirian?
    We own a residential property portfolio and half the tenants are FOREIGNERS!!
    That’s the world we live in. EU freedom of movement has played a part in this current situation. I would also warn, that most of the financial world,used residential and other property assets to back up loans and mortgages,destroy the value of those at your peril, and don’t forget,any losses drops in the laps of those who already own their homes, so they finish up in negative equity.
    Like everything these days,it’s not a simple solution. Land is the biggest cost to the build up,to residential and commercial costs of building,not the actual bricks,mortar and labour.

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  3. I would imagine more than 45% of foreigners are buying on the island, not sure where it leaves the locals. The cost of living has also become extremely expensive. Many will sell up and leave, I guess. 

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  4. Most of the new properties are built for the mid to high end market ( it’s not for nothing there is the new international estate agent next to round about near St Catarina Park) so let’s touch on another vital set of costs to be built in for locals, the cost of buying and selling property in Madeira, its eye watering amounts.
    The facts of life,are,property ownership is expensive and very long term commitment, but people buy cars for 40/50/60k and don’t balk at taking that debt on for three or four years, so it’s priorities that need brokering in as well.
    As I’ve stated,complicated dynamics at play here.

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