Portugal has become one of Europe’s best loved expat destinations – with good reason.
Expats can enjoy a mild climate, welcoming culture, beautiful coastline and an affordable cost of living – 30–40% lower than in the UK and about 33% lower than in the US.
The only big issue then facing those embracing this new home from home is where to settle?
From the bustling streets of Lisbon to the relaxed beaches of the Algarve, here’s our guide to the best neighbourhoods for expats.
Lisbon – the vibrant capital
Lisbon’s unique blend of old-world charm and modern energy makes it a top choice for expats, and the following neighbourhoods are particularly popular with digital nomads, young professionals and relocating families:
Alfama
Walking through this area is like a step back in time. It’s authentic ‘old Lisbon’ with its narrow cobblestone streets, beautiful traditional houses with the Moorish-style hand-painted, ceramic azulejo tiles, and traditional Portuguese ‘fado’ music drifting through the air.
It ticks all boxes for those who value culture and community but be aware that hill climbs and steep alleys are part of daily life in Alfama.
Príncipe Real
Literally translating as ‘Royal Prince’ in Portuguese, this is a leafy and stylish Lisbon district taking its name from Dom Pedro V, a 19th century prince. It is admired for 19th century buildings, elegant gardens, sense of history and a relaxed yet refined reputation.
It has now become a hub for expats and creative types, reflected by boutiques, trendy cafés, weekend markets and plenty of green space, local charm plus cosmopolitan flair.
Campo de Ourique
A magnet for expat families, attracted by quieter streets and excellent schools served by a handy mix of supermarkets, bakeries and local restaurants. It is often described as one of the most ‘liveable’ parts of the Portuguese capital and features a famous food market and many specialist stores.
Porto – second city, but never second fiddle
Lisbon might be the capital, but many will argue in favour of Porto’s claims to fame, and many expats will join the chorus in appreciation of its riverside beauty, historic charm and world-class wine culture. These are some of the newcomers’ favourite districts:
Foz do Douro
Perfectly perched where the Douro River meets the Atlantic, Foz do Douro is a seaside oasis within Porto, with cool beaches, chic cafés and scenic coastal walks, it’s ideal for those who want city access without sacrificing nature.
Cedofeita
Once a bohemian quarter, this district has become one of the second city’s most dynamic areas. Art galleries – particularly along the Rua Miguel Bombarda – boutique shops and relaxed bars attract expats and locals alike, and a central location makes it easy to explore the rest of the city on foot.
Bonfim
This is the rising favourite with younger expats, as it is more affordable than some central areas yet packed with character offered by its vintage stores, creative studios and street arts.
Cascais – mixing coastal elegance with a strong community
A short train ride from Lisbon, Cascais combines seaside luxury with relaxed Portuguese living. Its charming marina, sandy beaches and safe, walkable streets make it a magnet for expat families, retirees and remote workers. Key areas for expats hunting a new home:
Cascais Town Centre
Perfect for those wanting everything on their doorstep. Cascais’ historic centre is filled with cafés, bakeries, and boutique shops, while the weekly farmers’ market is a community highlight.
Estoril
Close to Cascais, Estoril is known for its elegant villas, pristine beaches and famous casino. It’s a slightly quieter alternative to central Cascais but still offers easy access to Lisbon by train.
The Algarve – sunshine, surf and serenity
The Algarve’s golden beaches, warm weather and relaxed lifestyle have made it a perennial favourite among expats – particularly retirees and digital nomads – and there’s a neighbourhood to suit everyone whether it be bustling towns or hidden coves. Here’s our pick with expats in mind:
Lagos
A historic town with dramatic cliffs and scenic beaches, Lagos offers a vibrant yet laid-back vibe. It’s especially popular with younger expats and remote workers thanks to a calendar of cultural events, a surf culture and its buzzing nightlife.
Albufeira Old Town
Known for its lively atmosphere, Albufeira is a top choice for expats who love the social scene, though some might still prefer to be based away from ‘The Strip’ during peak tourist season. The pedestrianized Old Town is full of restaurants and bars, and the nearby beaches are some of the Algarve’s best.
Tavira
Tranquil Tavera wins with those who love traditional architecture. It’s ideal for those who prefer relaxed living and authentic community experiences and offers riverfront promenades and peaceful plazas.
Tips to help expats make the right choice
• Lifestyle first: are you hunting for nightlife, family-friendly streets, beaches or cultural immersion? Your priorities should guide your choice.
• Transportation matters: Lisbon and Porto offer excellent public transport, while many Algarve towns are easier to navigate by car.
• Consider language support: English is widely spoken in expat hubs, but learning Portuguese can deepen your experience and unlock local connections.
• Budget wisely: prices vary widely – city centres and coastal hot spots tend to be pricier than quieter inland areas.
Paul Stannard, chairman and founder of Portugal Pathways, commented: “It’s important to really explore everything Portugal has to offer. Portugal’s various neighbourhoods can meet the needs of any dream of an expat lifestyle, whether you’re drawn by culture, coastlines, community or convenience.”
About Portugal Pathways
Portugal Pathways has supported hundreds of Golden Visa residency-by-investment applications and provides expert guidance through its professional supply chain network on luxury property, wealth management, and tax optimisation, including post-NHR tax regime planning, as well as private healthcare, IFICI tax incentive applications, money transfers and bespoke relocation solutions to enhance life and investments in Portugal.
Disclaimer: The information on the Portugal Pathways website and in email communications is for general informational purposes only and should not be construed as legal, tax, or financial advice. You should consult and check with a qualified professional advisor before relying on any information provided on this website or in email communications. As it relates to investments in Golden Visas or other wealth management solutions offered by regulated and professional advisors, it is important to note that past performance is no guarantee of future returns. Private equities can be highly illiquid and come with risk and should always be under professional independent advice.
