In all Portuguese regions, considerably fewer homes are built today than at the turn of the century. Over the past two years, in 2024 and 2025, the North led with 939 dwellings licensed per 100,000 inhabitants, almost double the figure recorded in Greater Lisbon (496). Madeira (786) and the Algarve (710) also showed high figures, while the Centro (691) and Oeste and Vale do Tejo (686) occupied an intermediate position. The Alentejo (415), Greater Lisbon (496), and the Setúbal Peninsula (518) were at the opposite end.
This reality is particularly relevant in a context of strong increases in housing prices. The construction of new dwellings is one of the main ways to increase available supply, but the territorial distribution of construction determines in which markets that supply is effectively sufficient. Building more across the country does not necessarily mean sufficiently increasing supply in the municipalities where demand is highest.
The differences become even more pronounced at the municipal level. Construction is generally lower in the country's interior, but these territories also show lower housing demand. The scenario is different in many areas with higher demand and greater pressure on housing supply, particularly municipalities in Greater Lisbon and the Algarve, which show relatively low construction levels relative to existing demand, contributing to higher prices.
The authors, André Pinção Lucas and Juliano Ventura, conclude that Portugal builds far fewer homes today than two decades ago, but, within this overall low level, there are considerable differences in construction capacity between regions and municipalities. The article is a partnership with the +Liberdade Institute.
