Overview of the Portuguese Rental Market
The rental market in Portugal is governed by the Novo Regime do Arrendamento Urbano (NRAU). In 2025 and 2026, the market continues to be influenced by the "Mais Habitação" legislative package, which introduced stricter regulations on rent increases and short-term lease durations to prioritize long-term residential stability for residents and foreign nationals.
Renting a property requires a formal written contract registered with the Portuguese Tax Authority (Autoridade Tributária e Aduaneira). Verbal agreements are not legally enforceable for long-term residency and do not provide the necessary documentation for residency permits or visa applications.
Types of Rental Contracts
In Portugal, residential lease agreements generally fall into two categories:
- Fixed-Term Contracts (Contrato com Prazo Certo): These have a specific start and end date. Under current laws, the minimum duration for a primary residence contract is typically one year, unless the lease is for temporary purposes (e.g., seasonal work or study).
- Indefinite Term Contracts (Contrato por Duração Indeterminada): These do not have a set expiration date and continue until one of the parties terminates the agreement following legal notice periods.
Most landlords prefer fixed-term contracts of 1 to 3 years. For foreigners, these contracts are essential as they serve as proof of accommodation for the Agência para a Integração, Migrações e Asilo (AIMA).
Financial Requirements and Costs
When entering a lease agreement, tenants are typically required to provide a combination of rent advances and security deposits. Portuguese law regulates the maximum amounts a landlord can request:
- Prepaid Rent: Landlords may ask for a maximum of two months of rent in advance.
- Security Deposit (Caução): The deposit is limited to a maximum of two months' rent. This amount is intended to cover potential damages to the property.
Average rental prices vary significantly by region. As of early 2026, a standard one-bedroom apartment in central Lisbon averages approximately 1,300 EUR ($1,365 USD, Jan 2026), while similar properties in Porto average around 1,000 EUR ($1,050 USD, Jan 2026). In smaller regional cities like Coimbra or Braga, prices may range from 600 EUR ($630 USD, Jan 2026) to 850 EUR ($892 USD, Jan 2026).
Tenants should also budget for the Stamp Duty (Imposto do Selo), which is 10% of one month's rent, usually paid by the landlord upon registering the contract at the Portal das Finanças.
Essential Documentation for Foreigners
To sign a rental contract in Portugal, foreign nationals must provide specific documentation to prove their legal status and financial solvency:
- NIF (Número de Identificação Fiscal): The Portuguese tax identification number is mandatory for all financial transactions, including leases.
- Identification: A valid passport or EU National ID card.
- Proof of Income: Recent payslips (recibos de vencimento), a Portuguese work contract, or the previous year's tax return (IRS).
- Guarantor (Fiador): Many landlords require a Portuguese guarantor who assumes financial responsibility if the tenant defaults. Foreigners without a local guarantor may be asked to pay more months of rent in advance as an alternative, though this remains subject to negotiation.
Tenant Rights and Termination
Tenants in Portugal are protected by several statutory rights regarding maintenance and contract termination. Landlords are responsible for structural repairs and external maintenance, while tenants handle minor upkeep related to daily use.
Notice Periods
Termination rules depend on the remaining duration of the contract. For fixed-term contracts, the following general rules apply to tenants:
- Contracts longer than 1 year: 120 days' notice is typically required.
- Contracts shorter than 1 year: 60 days' notice is standard.
Note: Tenants can generally only terminate a contract after one-third of the initial duration has elapsed.
Rent increases are regulated annually by the government based on inflation indices. For 2025 and 2026, the "Mais Habitação" rules may impose specific caps on annual increases for existing contracts to prevent excessive market volatility.
Utility Connections and Additional Costs
Unless otherwise stated in the contract ("despesas incluídas"), tenants are responsible for setting up and paying for utilities. This includes electricity, water, gas, and internet. In 2026, average monthly utility costs for an 85m² apartment are approximately 120 EUR ($126 USD, Jan 2026) to 180 EUR ($189 USD, Jan 2026), depending on seasonal heating or cooling needs.
It is highly recommended to verify the Energy Certificate (Certificado Energético) of the property before signing, as this impacts monthly utility expenses significantly. Landlords are legally required to provide this document during the viewing or at the time of contract signing.