Portugal is a European country that is well-known among tourists for its natural beauty. Whether it’s the stunning golden beaches of the Algarve or the volcanic islands of the Azores, the country never disappoints its visitors. The historic and top cities of Portugal, Lisbon and Porto, also attract a large number of tourists to the country. According to the World Travel and Tourism Council, the Portugal tourism sector is set to continuously grow in 2025, just like the strong year of 2024. Well, Portugal is not only the best tourist destination but is also an attractive hub for investment. According to Eurostat data of Q1 2025, with the 16.3% increase in housing prices in Portugal, the Portugal real estate has performed better than countries such as Finland (-1.9%) that saw a decline in house prices.
Record Breaking Growth of Portugal Tourism Sector
In 2024, the Portugal tourism had already broken records by contributing €60.6 billion to Portugal’s economy and employing around 1.2 million people, which is nearly 23% of total employment. In 2025, as per the Economic Impact Research (EIR) in collaboration with Oxford Economics, tourism in Portugal will contribute around €62.7 billion to the economy of Portugal, which is 21.5% of Portugal’s GDP and almost 38% higher than before the pandemic in 2019. Prediction says the tourism industry will provide jobs to 1.2 million people, which means one out of every job in Portugal will be related to tourism. The strong growth of tourism in Portugal demonstrates that in 2035, the travel industry can bring over €74.6 billion to Portugal’s economy and can support 1.4 million jobs. That means tourism in Portugal will grow more and more with the passing years.
Brazil Tourists Generated €681 Million
If we look at the nationalities of tourists in Portugal, we can infer that the Brazilian tourists are spending more time in Portugal. Lidia Monteiro, who is a member of the Board of Directors for Turismo de Portugal, said that in August 2025, the visitors from Brazil had spent around €681 million, making this year the best for tourism in Portugal. Furthermore, this number is expected to exceed 1M this year. Even though the number of visitors is the same as in the previous year, the fact that they are staying longer and spending more is leading to results that show 2% more revenue recorded compared to 2024.
Rising Demand from the US and Poland
According to Instituto Nacional de Estatisticas (INE), in July 2025, the Polish tourists increased by 14% and the US tourists by 12.3%, making them the top-growing tourism markets for Portugal, followed by Germany at the third spot. Among many popular cities of Portugal, Lisbon emerges as Europe's leading city. The metropolitan city attracts a large community of tourists in Portugal, resulting in most demand from the US surging by nearly 90% in the past four years. The reason behind this surge can be the expanded air travel capacity between the US and Portugal. As in H1 2024, more than one million US citizens visited Portugal, representing a 15% increase from 2023.
Rising US Demand Reshaping Portugal Real Estate
With most American tourists staying in Portugal, not just the tourism sector of Portugal is boosting, but also the real estate in Portugal, especially in areas such as Lisbon, Porto, and the Algarve. According to data from a site named Roca estate, in 2024, the accommodation revenue rose by 12.7%, reaching €623.8 million and demonstrating strong returns for property owners. According to the Portugal news, around 14,000 Americans made Portugal their home in 2024. This is increasing demand for long-term rentals and creating opportunities for real estate investors. The reasons behind this strong tourism growth and rising rental demand in Portugal are due to the low cost of living and welcoming atmosphere of Portugal. Moreover, in the last five years, the foreign direct investment projects in Portugal have increased by 40%.
UK Tourists Drive Portugal Tourism and Luxury Real Estate Growth
Despite the US being a strong market for Portugal Tourism, the UK still remains the biggest tourism market for Portugal. According to Statistics Portugal (INE), 1.2 million British tourists visited Portugal in H1 2024, recording a 6% increase from the same time in 2023. Among all foreign visitors in Portugal, up to 13% are from the UK, and they contribute 18% of total overnight stays in the country. In addition, out of 25 million foreign residents in Portugal, the British visitors made up 4.7 million stays. This shows that many UK citizens are moving to Portugal and the main reason is the change in the UK non-dom tax regime which has resulted in a large number of UK citizens leaving their home country and finding home in a low tax country by investing in Luxury real estate Portugal among which some cities are mainly popular such as Lisbon Portugal real estate and Porto Portugal real estate.
Luxury Real Estate Portugal: From Tourism to Residency
Increasing tourism sector growth in Portugal results in strong demand for luxury apartments and hotels by tourists. This means it ultimately led to the rapid growth of Portugal real estate. As per the Idealista price index, the housing prices in Portugal surged by 7.6% in September 2025 compared to the previous year, where the median cost per square metre reached €2,934. Moreover, after the government ended Portugal real estate investment for Portugal golden visa investors in 2025, the focus of people has shifted more towards the hospitality-focused luxury real estate projects in Portugal. According to Portugal Resident, in 2025, the hotel investment in Portugal has reached €331 million, which is 33% higher than in H1 2024.
Conclusion
Portugal is no longer just the best European country but also an attractive hub for tourism and investment. With record-breaking tourism revenues, the demand for luxury real estate in Portugal has remarkably increased in recent years. The country, by offering various jobs in the tourism sector also provides multiple opportunities to people, making it the best investment option in 2025.