Living in Portugal: Pros and Cons for Expats in 2026

Living in Portugal has become one of the most sought-after places for expats, retirees, and families over the last few years. About 1.58 million foreign nationals held legal residence by the end of 2025, which is about 42,000 more immigrants than the previous year, according to AIMA. 

But why do so many choose to lay down roots on this side of the Iberian Peninsula? Ask any expat, and they will be quick to tell you that it comes down to EU membership, access to the Schengen Area, a lower cost of living, and accessible healthcare. 

As with all countries, there are pros and cons of living in Portugal in 2026. Bureaucracy can be slow, amendments to the Nationality Law recently came into force, and housing prices have doubled over the past decade. 

However, most people can forgive the cons in favor of living in one of the safest countries in the world, experiencing Portugal’s rich culture, and the ease of international travel.  

In this article, we’ll explore the advantages and drawbacks of living in Portugal, along with the residency routes open to non-EU nationals and how the new citizenship rules affect them.

Living in Portugal: Key Takeaways

Living in Portugal has many advantages, including excellent healthcare, a safe environment, and a lower cost of living compared to most Western European countries.

While Portuguese is the official language, English is widely spoken in major towns and cities. This makes it easier for immigrants to integrate into local communities.

There are several visa options for non-EU citizens, such as the Portugal D7 Visa for people who have a passive income, the Portugal D8 Visa for digital nomads, and the Portugal Golden Visa for investors.

One of the disadvantages of living in Portugal is the rising cost of housing. Real estate prices have risen by almost 20% over the last year.

There are many advantages to living in Portugal, and the immigrants who have been here for a while will all point to the same reasons.  

It’s one of the safest countries in the EU and the world, it has mild weather for most of the year, and the cost of living is considerably lower than in most European countries. 

Safety: Portugal is ranked 7th on the Global Peace Index. Violent crime is rare, and the most common issue expats run into is pickpocketing on trams and at busy tourist spots in Lisbon. 

Cost of living: Compared to Western Europe, Portugal is one of the most affordable countries to live in. While rent and everyday basics are still reasonably priced in large cities like Lisbon and Porto, it becomes even cheaper outside the main cities. 

Healthcare access: Public healthcare in Portugal is provided through the tax-funded Serviço Nacional de Saúde (SNS). It is available to all legal residents and provides doctor consultations and hospital care for free, while prescription medication is heavily subsidized. In the 2025 Health Care Index by Numbeo, Portugal ranked 23rd globally and 14th in Europe. 

Schengen access: As one of the Schengen Zone countries, residents in Portugal can travel visa-free to any of the 29 countries for up to 90 days in a 180-day period.  

Climate: Portugal sits on the Iberian Peninsula, so it has one of the mildest climates in Europe. The Mediterranean climate means that regions like the Algarve get about 300 days of sunshine a year, and even in winter, Lisbon is rarely under 10 degrees Celsius. 

Education: Higher education is highly regarded, with 11 universities featured in the QS World University Rankings, including the University of Porto, the University of Lisbon, the University of Coimbra, and NOVA University Lisbon. These universities provide free education for citizens and legal residents, including those holding a Golden Visa, with most courses available in both Portuguese and English. 

Tax considerations: Portugal introduced the Tax Incentive for Scientific Research and Innovation, known as IFICI or NHR 2.0, as a replacement for the original Non-Habitual Resident regime. It provides eligible professional income from qualifying activities with a 20% flat income tax rate for 10 years. 

English is widely spoken: Portuguese is the official language, but many people speak English, especially in larger cities. It is common for young adults to speak two or more languages, but being bilingual is uncommon in the countryside.   

Even with excellent healthcare, safe cities, and great food, there are some disadvantages to living in Portugal.  

AIMA processing delays: The biggest hurdle that any resident has to face is the first-time biometric appointment with AIMA. Once you arrive in Portugal, you have to convert your visa into a residency permit, and AIMA needs to capture your biometric data. Current wait times are between 12 and 18 months for an appointment, and then it can take another 4 to 12 weeks for your residency card to arrive. 

Rising housing costs: Many countries in Europe have seen a sharp increase in housing costs, and Portugal is no different. According to the OECD Economic Surveys: Portugal 2026 report, real estate prices have doubled over the past decade, and in places like Lisbon, monthly rent has increased by 94%. 

Language barrier: While most young people and adults in major cities can speak English, it’s less common to find an English speaker in the rural areas. This bleeds through to administrative tasks, too. Many official documents are only available in Portuguese, and many of the AIMA, Finanças, and local council officials don’t speak English.   

Local salary levels: Portugal has one of the lowest average national salaries in Europe. In 2025, the national median salary was €1,741 per month, and the hourly wage was about €6. According to the European Commission, this wildly contrasts with countries like Denmark and Belgium, where the median salaries are almost €4,000. 

Summer heat: Immigrants coming from colder climates might enjoy the abundance of sunshine, but Portugal can get incredibly hot, even by local standards. Central Portugal and the Algarve regularly see temperatures exceed 40 degrees Celsius in July and August. In 2025, Mora in the Alentejo reached 46.6 degrees, setting a new record for Portugal. 

Higher taxes on certain goods: Some goods are taxed higher in Portugal than elsewhere or incur an additional tax when you buy them. For example, vehicles are taxed at 23% VAT, but the Imposto Sobre Veículos (ISV) tax is added to the sale price, and there is also an annual road tax.

Portugal has several avenues for relocation, and the right option for you depends on your employment, financial situation, or passive income.   

Portugal D7 Visa 

The Portugal D7 Visa is designed for passive income earners, retirees, and anyone looking to relocate to Portugal without making substantial investments.  

This visa is ideal for non-EU citizens who can demonstrate a reliable income source exceeding the national minimum wage of €920 per month stemming from pensions, rental income, dividends, and investments. 

You can also add your spouse or dependent parent to the application, but then minimum monthly income increases by 50%, and increases by 30% for each child. 

Once your visa has been granted, you’ll have an appointment with AIMA where you’ll convert it into a residency permit. The card is valid for two years, and once you renew it, it is valid for another three years. After five years of residency, you can apply for permanent residency.  

Portugal Digital Nomad Visa (D8) 

The Portugal Digital Nomad Visa is designed for non-EU freelance workers and digital nomads who want to live in Portugal.  

To qualify, you must earn at least €3,680 by working remotely for clients based outside of Portugal. This includes freelancers and self-employed people. 

Portugal Golden Visa 

The Portugal Golden Visa is a residency by investment program. By making an investment in one of the qualifying options, you are granted a long-term residency visa. 

An advantage of the Golden Visa is the minimum stay requirement. You are only required to spend seven days in Portugal in the first year and 14 days in each of the subsequent two-year periods. 

After maintaining your investment for five years, you can apply for permanent residency. When you reach 10 years of residency (seven years for EU and CPLP citizens), you may be eligible for Portuguese citizenship. 

There are several investment options for the Golden Visa, including: 

• Investing a minimum of €500,000 into a fund subscription 
• Making a cultural donation of at least €250,000 
• Scientific research donation of at least €500,000. 
• Job creation by establishing ten jobs in Portugal. 

Business investment of at least €500,000 to enhance a company’s capital with job creation. 

Where to live in Portugal might be one of the hardest decisions to make. While the country might be small compared to Spain or France, it includes many different landscapes and environments. There is no single best place to live, as your decision will be influenced by your lifestyle, preferences, and budget.

Here are a few highlights: 

• Lisbon: As the capital city, it is the heart of Portugal. You’ll find many expat communities, a well-connected public transport system, many international schools, and plenty of things to see and do.  
• Cascais or Setúbal: Only a short drive from Lisbon, these regions are good options if you want access to Lisbon but prefer to be close to the coast. They are similarly well-connected, and the nearby Arrábida Natural Park is great for weekend excursions. 
• The Algarve: If you prefer a beach environment in the Mediterranean, the Algarve gets about 300 days of sunshine a year. Towns like Faro, Lagos, and Tavira have close-knit communities and many historical attractions – in addition to beautiful beaches.   
• The Silver Coast: After the Algarve, the Silver Coast is also an excellent option if you want the beach on your doorstep while being close to major towns like Óbidos, Caldas da Rainha, Nazaré, and Peniche. 
• Porto: Sitting on the Douro River, Porto is Portugal’s second largest city. It has plenty of walkable streets, a vibrant culture, and the cost of living is lower than in some parts of Lisbon.