Property Prices Rise Moderately in Madeira, but Remain High
According to a calculation by Idealista, Funchal is now the second most expensive tourist destination in Southern Europe for buying property, according to new data from real estate platform Idealista. The capital of Madeira recorded a price of 3,645€/m² in June 2025 — just behind Palma de Mallorca, where prices reached 4,907€/m².
Lisbon remains the most expensive city overall in Southern Europe, reaching a record 5,769 €/m². Madrid is now close behind, after a 25% increase pushed prices there to 5,642 €/m². Other major cities such as Milan and Barcelona also approached or passed the 5,000 €/m² mark.
Portugal Has the Highest Median Sale Price Among Three Countries
Idealista compared housing prices in Portugal, Spain, and Italy. Portugal had the highest national median sale price in June 2025, at 2,898 €/m². This puts it ahead of Spain (2,438 €/m²) and Italy (1,828 €/m²). Both Portugal and Spain reached new national price records last month.
The residential market in Southern Europe continues to record price increases in both sales and rentals, worsening access to housing. Portugal once again was the country with the most expensive homes to buy and rent, with Lisbon standing out in particular.
Despite its moderate increase, Funchal remains more expensive than cities like Faro and Rome - the Italian capital still costs less on average (3,215 €/m²) even though its prices have grown at a slower pace.
Rents Increase Across All Tourist Areas
In the rental market, Funchal ranked fifth among Southern Europe’s tourist cities, with average rents at 15 euros/m². The most expensive cities to rent are all in Spain: Palma (18.3 €/m²), Málaga (15.6 €/m²), and València (15.5 €/m²). Naples (Italy) also ranked ahead of Funchal.
Among the Portuguese cities studied, Funchal had the highest rents, followed by Faro (14.2 €/m²). Setúbal, however, was the only city in Portugal to reach a new historical high, with rents hitting 13.1 €/m². Beja remained the most affordable option at just 10.1 €/m².
The steepest rise in rental prices was seen in Faro, which increased by 12% year-on-year, followed by Palermo (11.1%) and Setúbal (11%). Naples, by contrast, had the smallest change, with a rise of only 1.5%.
Funchal Shows Slower Growth, But Housing Pressure Remains
Among the 14 tourist cities analyzed, Funchal had the third lowest annual increase in rental prices, at 6.4%. Despite this relatively modest growth, property and rental costs in Funchal remain among the highest in Southern Europe.
Source: Idealista
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