Madeira Records 8.3% Price Drop in Q4 2025, One of Only Two Regions
Housing prices in Madeira fell by 8.3% in the fourth quarter of 2025 compared with the same period a year earlier, making it one of only two regions in Portugal to record a decline. The other was Alto Tâmega e Barroso, where prices dropped by 12.1%.
The figures, released by the National Institute of Statistics, show that 24 out of 26 sub-regions saw housing prices rise over the same period. Madeira’s decline stands out in a market otherwise defined by broad increases.
National Median Price Reaches 2,198 €/m2 With 17.5% Annual Increase
Across Portugal, the median price for the 41,789 family homes sold reached 2,198 €/m2 in the fourth quarter of 2025. This represents a 17.5% increase compared with the same quarter in 2024.
At the same time, the number of transactions fell by 5.3% year-on-year, suggesting that fewer homes were sold even as prices continued to rise nationally.
Madeira Remains Fourth Most Expensive Region at 2,655 €/m2
Despite the recent decline, Madeira continues to rank among the most expensive regions in the country. With a median price of 2,655 €/m2, it holds the fourth position, behind Greater Lisbon, the Algarve, and the Setúbal Peninsula.
Data for the full year 2025 also places Madeira above the national average, which stood at 2,076 €/m2.
Madeira’s Previous Numbers from the INE Reports:
Q4 2024 (Oct–Dec): €2,895/m² - this was the peak.
Q1 2025 (Jan–Mar): €2,518/m² - prices dropped.
Q2 2025 (Apr–Jun): €2,381/m² - prices dropped again.
Q2 2024 (Apr–Jun, one year earlier): €2,046/m²
Quarterly Growth of 5.7% Signals Short-Term Recovery in Madeira
While prices fell compared with a year earlier, they rose by 5.7% when compared with the third quarter of 2025. In that earlier period, the median price stood at 2,512 €/m2.
This quarterly increase suggests a partial recovery in the short term, even as the annual figures show a decline.
Funchal Prices Rise to 3,612 €/m2 but Remain Below 2024 Levels
In Funchal, the region’s largest municipality, housing prices rose from 3,346 €/m2 in the third quarter to 3,612 €/m2 in the fourth quarter of 2025. This was the highest level recorded during the year.
However, prices remained 2.2% lower than in the same quarter of 2024, when they reached 3,693 €/m2.
Among municipalities with more than 100,000 residents accross Portugal, Funchal ranked 14th in terms of housing costs.
Local Variations Show São Martinho at 4,120 €/m2 and São Vicente at 1,289 €/m2
Within Madeira, price differences between areas remain significant. In Funchal, the parish of São Martinho recorded the highest median price at 4,120 €/m2, followed by Sé at 3,751 €/m2.
At the lower end, São Vicente had the lowest median price in the region, at 1,289 €/m2.
Other municipalities such as Câmara de Lobos and Porto Santo reported values above 2,000 €/m2, while still remaining below the regional average.
Foreign Buyers Pay Up to 49% More in Lisbon and 35.6% in Porto
The data also highlights differences between domestic and foreign buyers. In Greater Lisbon, buyers with a tax address abroad paid prices 49.0% higher than those paid by residents in Portugal. In the Porto metropolitan area, the difference reached 35.6%.
Madeira is among the regions where both domestic and foreign buyers are active in higher-priced markets, alongside Lisbon, the Algarve, Setúbal Peninsula, and Porto.
Price Growth Accelerates in 13 of 24 Large Municipalities
In Portugal’s larger municipalities, price growth gained pace in 13 out of 24 areas with more than 100,000 residents during the fourth quarter of 2025.
Barcelos and Maia recorded the largest increases in growth rates, while Matosinhos and Coimbra saw the sharpest slowdowns. Lisbon and Porto both posted moderate increases in their growth rates compared with the previous quarter.
The data presents a mixed picture: a national market still rising, with local differences becoming more visible - and Madeira standing out as a rare case where prices moved in the opposite direction. It remains to be seen how 2026 will develop.
Summary of Real Estate Market Developments in Madeira
Year-on-Year Market Contraction: Madeira experienced an 8.3% decrease in housing prices compared to the same period in 2024, making it one of only two sub-regions in Portugal to see a decline amidst a national median price surge of 17.5%.
High Valuation Relative to National Levels: Despite the recent dip, Madeira remains the fourth most expensive region in Portugal with a median price of €2,655/m², significantly exceeding the national median of €2,198/m².
Signs of Short-Term Recovery: While annual figures show a drop, the market showed immediate momentum at the end of the year with a 5.7% quarterly increase from Q3 to Q4 2025, indicating that the downward trend may be stabilizing.
Significant Internal Disparity: Pricing within the archipelago is highly localized; premium areas like São Martinho (€4,120/m²) command prices nearly four times higher than more affordable municipalities like São Vicente (€1,289/m²).
Funchal’s Dominance and Foreign Influence: Funchal reached its highest price of the year in Q4 (€3,612/m²), and like Lisbon and Porto, Madeira continues to be a primary target for foreign buyers who historically pay higher premiums than domestic residents.
Sources:
Diário de Notícias Madeira
RTP Madeira
Times of Madeira
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