Median Price in Madeira Drops 5.4% Between April and June 2025
House prices in Madeira have fallen for the second consecutive quarter, according to data released today by Portugal’s National Statistics Institute (INE). The median price per square meter decreased from €2,518 in the first quarter (Q1) of 2025 to €2,381 between April and June - a quarterly drop of 5.4%.
The region reached its record high in the final months of 2024, when average prices stood at €2,895 per square meter. Despite the recent decline, prices remain 14.5% higher than during the same period in 2024, showing that annual growth continues, albeit at a slower pace.
Let’s break it down with Madeira’s actual 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
The Autonomous Region of Madeira was the only one to show a year-on-year decrease of 8.8% in the number of transactions.
Instituto Nacional de Estatistica (.PDF), 22 October 2025
National Median Price Reaches €2,065/m2 With 19% Annual Increase
Across Portugal, the housing market performed differently. The median price of the 41,608 family homes sold in the second quarter of 2025 reached €2,065/m2 - a 19% rise compared with the same quarter of the previous year. INE noted that the number of transactions nationwide increased by 15.6%.
Among Portugal’s 26 NUTS III sub-regions, Baixo Alentejo recorded the sharpest rise, with prices increasing by 38.7%. INE highlighted that “the sub-regions with the highest median housing prices – Greater Lisbon, Algarve, Setúbal Peninsula, Autonomous Region of Madeira, and Porto Metropolitan Area – also had the highest values in both categories of buyer’s tax domicile (national and foreign).”
Property Transactions in Madeira Down Nearly 40% Since Late 2024
In Madeira, the decline in prices has been accompanied by a sharp fall in the number of property sales. Transactions dropped from 1,244 in Q4 2024 to 849 in the first quarter of 2025, and then to just 749 between April and June. This represents a 40% decrease from the end of last year and an 11.2% drop compared to the same quarter in 2024.
Analysts suggest that the decline may reflect a period of market correction after last year’s record highs, combined with a slowdown in demand. The INE figures indicate that Madeira’s real estate sector is cooling faster than most other regions in Portugal.
Funchal recorded a median price above the national benchmark (€2,928/m², +7.2%), although the year-on-year growth rate was lower (compared to nationwide growth).
Instituto Nacional de Estatistica (.PDF), 22 October 2025
Funchal Prices Rise 7.2% Annually, Most Expensive Municipality at €2,928/m2
Funchal, the capital of Madeira, continues to rank as the fourth most expensive municipality in Portugal, with an average price of €2,928/m2 - unchanged from the first quarter of 2025 but significantly below the €3,693/m2 recorded in the last quarter of 2024.
While prices in Funchal are 7.2% higher than a year ago, the city has seen a notable slowdown in activity. The number of transactions fell from 369 in the first quarter to 263 in the second, a drop of 28.7% compared to the previous quarter and 34.1% year-on-year.
Funchal Real Estate Prediction - What Could Happen Next
Let’s take a closer look at the numbers to better understand what can be expected in the Funchal housing market.
Fewer Transactions Equals Lower Demand or Limited Supply
A drop in sales often means fewer people are buying - either because:
Prices have become too high for many potential buyers (reduced affordability), or
There are fewer homes available for sale (restricted supply).
In Madeira’s case, prices have remained relatively high, so affordability is likely part of the issue.
Stable or Slightly Higher Prices = Sellers Holding Firm
Even though fewer homes are selling, prices haven’t collapsed - they’re still 7.2% higher than a year ago. That suggests sellers are not yet lowering their asking prices significantly. They might prefer to wait rather than sell at a lower value, especially if they believe demand could recover.
Possible Market Transition
This combination - fewer transactions but steady prices - often indicates a transition period:
The market could be stabilizing after a rapid run-up in prices (like Madeira’s peak in late 2024).
Or, if economic conditions worsen (for example, higher interest rates or weaker tourism-driven demand), prices could start to fall further in future quarters.
What It May Forecast
If the trend continues - sales falling and prices softening - it might forecast:
A moderate price correction in the short term.
Longer selling times for properties.
And possibly more realistic pricing if sellers begin to adjust to lower demand.
In plain terms: Madeira’s housing market is cooling. Prices are still high compared to last year, but the sharp drop in sales shows that fewer buyers are willing or able to pay those prices.
Source: Instituto Nacional de Estatistica (.PDF), 22 October 2025
Care for a share?
Comments