House Prices Surge by 14.6% in Madeira in 2025
Madeira GuideThe real estate market in Madeira saw a significant increase, with house prices rising by 14.6% by the end of 2025. This growth positions Madeira as the second fastest-growing region in Portugal in terms of real estate value.
House prices in the Autonomous Region of Madeira experienced a notable increase of 14.6% in December 2025 compared to the same month the previous year. According to the Idealista price index, the median cost of buying a house in Madeira reached 3,715 euros per square meter by the end of December.
This makes Madeira the second region in Portugal with the highest increase in house prices over the past 12 months, surpassed only by the Azores, which saw a 20.1% rise. These figures indicate a robust demand for real estate in the region, likely driven by its appeal as a tourist destination and favorable living conditions.
Among the municipalities on the island, Santa Cruz recorded the most substantial annual increase in house prices at 25.4%, followed by Machico at 23.3%, Ponta do Sol at 21.3%, and Calheta at 20.3%. These areas are becoming increasingly attractive to both local and international buyers, contributing to the overall rise in property values.
Factors Driving the Price Increase
Several factors contribute to the rising house prices in Madeira. The island's growing popularity as a tourist destination is a significant driver, attracting international buyers looking for investment opportunities or holiday homes. Additionally, the quality of life, mild climate, and natural beauty of the island make it an attractive place for relocation.
Moreover, infrastructure developments and government incentives for property investments have further fueled the real estate market. The local government's efforts to promote sustainable tourism and enhance living standards continue to make Madeira a desirable location for both living and investing.
The Impact on Residents and Investors
For residents, the increasing property prices may pose challenges, particularly for first-time buyers and those looking for affordable housing. However, for current property owners and investors, the rising values represent an opportunity for significant returns on investment.
The real estate boom in Madeira reflects broader trends in Portugal, where property values have been rising steadily. As the island continues to gain international recognition, the demand for housing is expected to grow, potentially leading to further increases in property prices.
Sources
Madeira Guide
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