Algarve’s Coastal Property Market Continues Strong Growth Through 2025

The Algarve remains Portugal’s most established high-end coastal real estate market, attracting buyers from across Europe, North America, and beyond. 

Known for its Atlantic-facing beaches, mild year-round climate, and robust infrastructure, the Algarve continues to perform strongly in 2025. 

Interest is particularly high in prime areas such as Albufeira, Lagos, and Vilamoura, each offering a distinct balance of lifestyle and investment appeal.

Average prices in the Algarve reached €3,467 per square metre in August 2025, marking a 9.3% increase compared with the same month last year. This places the region ahead of many other Mediterranean destinations, reflecting its enduring appeal, limited supply of prime coastal land, and the quality of its developments.

For a deeper dive into Portugal’s luxury new homes market, register for Portugal Pathways' upcoming webinar, 'Investing in Luxury New Homes in Portugal,' on 26 August at 4:00 PM Lisbon Time.

Albufeira

Albufeira remains one of the Algarve’s most active real estate hubs, benefiting from its central location and a broad mix of property types.

The old town’s whitewashed streets and proximity to beaches such as Praia dos Pescadores and Praia da Oura appeal to lifestyle-driven buyers, while newer developments close to the marina attract those seeking modern design and strong rental potential.

High-specification apartments with sea views or within walking distance to the waterfront often secure early reservations in off-plan sales, particularly among international buyers looking for holiday residences.

Lagos

Lagos offers a distinct market profile, balancing historical architecture with some of the Algarve’s most striking natural settings.

Properties here range from restored period homes in the town centre to contemporary villas on the outskirts, many with panoramic coastal views.

The combination of a popular marina, long stretches of sandy beaches like Meia Praia, and dramatic cliffs at Ponta da Piedade has established Lagos as a year-round destination.

Buyers are often drawn by the slower pace of life, cultural depth, and access to unspoilt landscapes that remain protected from overdevelopment.

Vilamoura

Part of the famous Golden Triangle, Vilamoura is one of the Algarve’s most established premium destinations, built with long-term leisure and investment in mind.

Centred around an award-winning marina and surrounded by five championship golf courses, the area offers a range of gated communities, luxury apartments, and detached villas.

Many properties benefit from private pools, landscaped gardens, and integrated security, appealing to both permanent residents and seasonal visitors.

The well-maintained infrastructure, year-round services, and consistent visitor demand contribute to strong rental yields, making Vilamoura a strategic choice for investors seeking stable returns alongside lifestyle benefits.

Although price growth is expected to moderate from recent double-digit annual increases, forecasts point to a strong average national rise over the 12 months. In the Algarve, continued interest from overseas buyers, combined with limited supply in prime locations, suggests that competition for high-quality properties will remain strong.

With its combination of established resort communities, unspoilt coastal scenery, and proven long-term investment performance, the Algarve offers a rare balance of lifestyle and value. 

Whether in the traditional streets of Lagos, the vibrant centre of Albufeira, or the planned luxury of Vilamoura, buyers in 2025 are finding opportunities that deliver both immediate enjoyment and enduring potential.

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For a deeper dive into Portugal’s luxury new homes market, register for Portugal Pathways' upcoming webinar, 'Investing in Luxury New Homes in Portugal,' on 26 August at 4:00 PM Lisbon Time.

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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.

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Disclaimer: The information on the Portugal Pathways and Portugal Investment Owners Club (P Club for short) websites 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. Golden Visa investments need to be held for 6 to 7 years to allow for permanent citizenship/passport in the EU.

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