Portugal rental demand spikes 256% amid rising new‑home construction costs

Demand for rental housing in Portugal surged 256.1% between February and April 2026 compared with the same period in 2025, according to Imovirtual data. The increase was steady across the three months, with Lisbon remaining the most sought‑after district (17% of national searches) followed by Porto (9.2%). Braga was the only top‑10 district to gain share, and the municipality of Cascais saw its rental search share rise from 1% to 1.4%, a 381.7% jump. The most requested rental types were two‑bedroom (T2) and three‑bedroom (T3) units, while four‑bedroom (T4) properties recorded the highest year‑on‑year growth at 417%.

The cost of building new homes also accelerated, with Portugal’s construction‑cost index rising 5.9% year‑on‑year in April 2026 – the highest level ever recorded. Labour costs drove the increase, up 7.3% in the month, while material prices grew 4.7%. Diesel, copper and tiles saw notable price gains, whereas air‑conditioning equipment and prefabricated concrete fell.