House Prices Surge as Lagos Algarve Real Estate Remains in High Demand

House prices surge as Lagos, Algarve real estate stays in high demand, ranking among Portugal’s top five most expensive property markets. 

By LiveAlgarve on 9th May 2025 - 3-4 m. reading time 

The Algarve is no stranger to property demand, but this year is proving to be a standout year, especially for Lagos. With fresh data showing a significant rise in house prices, buyers are taking notice. If you’re considering buying a home in the Algarve, now’s the time to understand what’s driving the market and where the best opportunities lie, so you don’t get left behind by the Lagos Algarve real estate opportunities of today. 

Lagos Among Portugal’s Top 5 Most Expensive Areas

Lagos now ranks in the top five most expensive municipalities in Portugal. The average price per square metre here reached €5,717, placing Lagos alongside Lisbon, Cascais and Oeiras in terms of premium pricing.

This reflects a wider national trend. A new INE report from April 2025 revealed that house prices rose in 19 of Portugal’s 24 largest municipalities. The national average increase was 15.5%, the highest since 2022. 

Why Buyers Continue to Turn to the Algarve 

Several factors are fuelling the Algarve's continued property boom:

• International demand: Buyers from Germany, the UK, USA, France and Belgium are driving growth (Idealista, 2024 market outlook) - aided by economic uncertainty. 
• Desirable lifestyle: Year-round sunshine, safe communities and easy access to beaches.
• Limited supply: Especially for quality homes in prime locations.
• Investment appeal: Strong rental yields and rising property values make for solid returns.

Lagos stands out for offering a balance of modern living, historic charm and beautiful coastline, making it great for a second home, a relocation opportunity or a long-term investment.

Is Now the Right Time to Buy?

If you’re watching the Algarve market from the sidelines, these recent price shifts are a clear sign that waiting could cost more later. Quality homes in Lagos, Carvoeiro and Praia da Luz aren’t staying on the market for long and prices are moving upwards.
The Algarve is no longer a “hidden gem” it’s a well-known destination for smart buyers looking for lifestyle, location and long-term value.

If you’re after a luxury villa, a modern apartment or a traditional townhouse, at Live Algarve, we’re here to help you find the right property.