Portugal housing affordability score cut as Lisbon price-to-income ratio hits 18.7

We lowered Portugal's housing affordability score from 9.0 to 8.3 on Country To Live. Lisbon now shows a price-to-income ratio of 18.7 in Numbeo-based rankings cited by IndexBox, meaning a typical home costs nearly 19 times average annual earnings. That puts the capital among Europe's least affordable cities on this measure.

This is an editorial score for people comparing countries on our site. It is not a property forecast, and Portugal can still look affordable outside Lisbon hotspots if you earn well or target smaller cities.

Why we changed the score

• Lisbon's ratio is nearly double the "problem" line. Housing economists often treat a price-to-income ratio above 10 as hard for buyers under standard mortgage rules. Lisbon at 18.7 sits in the same band as Split (18.7) and above Prague, Milan, Vienna, Paris, and London on the European city list in the IndexBox report.
• Prices outran wages for a decade. The report cites roughly 240% growth in Portuguese house prices over ten years against about 59% growth in average wages. In central Lisbon, a 50 m² flat near €338,000 against roughly €17,000 net annual income illustrates the gap for local earners.
• OECD flagged weak housing access. Portugal's 2026 economic survey ranked it among developed economies with the least housing access, citing slow supply, regulatory barriers, and a thin rental market. Annual completions near 25,000–30,000 homes sit below estimates of 45,000–50,000 needed.
• Affordability pressure is not limited to expat headlines. Protests since 2023 and campaigns for rent controls and more social housing show local buyers and renters feel the squeeze, not only foreign demand in Alfama or Príncipe Real.
• Other Portugal scores are unchanged this round. Climate, safety, and residency routes on the Portugal country page still reflect longer-term strengths. Only housing affordability moved.

What the number means on our site

Housing affordability on Country To Live measures how reachable we think buying or renting a decent home looks for a typical mover, using national signals and city pressure. An 8.3/10 keeps Portugal relatively strong versus many Western peers, but below where it sat when inland towns and smaller metros still dominated the affordability story.

Open the Portugal country page for the full breakdown, run our cost of living calculator with Lisbon rent assumptions, or compare Portugal vs Spain if housing is your tie-breaker. Browse all country scores to see where Portugal sits after this cut.

Before you plan a move

1. Model Lisbon separately from the Algarve or interior. National averages still flatter Portugal. If your job or visa ties you to the capital, budget like a high-ratio European city, not a cheap-country default.
2. Do not assume remote EUR pay fixes the math. Strong foreign income helps, but purchase prices and competition in prime districts have decoupled from local wages. Run rent and deposit scenarios before you sign.
3. Watch supply and policy, not just listings. Banco de Portugal and local banks still cite supply shortages pushing prices up in 2026. Tighter lending may limit a crash, but that does not mean bargains return quickly.

We will publish another update if Lisbon's affordability metrics ease for a sustained period or if national rent and build-out data show a clear turnaround.

This note explains our editorial scoring only. It is not legal, financial, or property advice.