Article

Investing in Residential? Roll the Dice on Portugal’s Most Profitable Municipalities!

What if residential real estate investment felt a bit more like playing a board game?

September 18, 2025

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We’ve mapped out the top 20 Portuguese municipalities with the highest gross rental yields (annual property return considering the average contracted rent and average sale price) and gave it a playful twist with a game board style in Portugal’s map. Each municipality on the “board” reveals strong investment potential when comparing the average contracted rent to the average transaction price. We have analysed data from Confidencial Imobiliário for rented and sold apartments until July/2025 (12 months cumulative).

Leading the board:

Conquering first place on the ranking is Seixal municipality with c. 6.6% yield, the equivalent of dominating the game with a street full of hotels. The average contracted rent of €1,134/month with an average take up time of 2 months and average discount rate (asking vs. contracted) of -1.4%. The average sale price is €206,489, with an average time to sell of 4 months and an average discount rate (asking vs. sale price) of -4.7%.

Coming in second place, Moita municipality with c. 6.5% yield, with an average contracted rent of €870/month with an average take-up time of 3 months and average discount rate (asking vs. contracted) of -2.7%. The average sale price is €160,924, with an average time to sell of 4 months and an average discount rate (asking vs. sale price) of -3.8%.

Finally, the third place goes to Covilhã municipality with c. 6.2% yield, with an average contracted rent of €571/month with an average take-up time of 6 months and average discount rate (asking vs. contracted) of -0.8%. The average sale price is €111,028, with an average time to sell of 8 months and an average discount rate (asking vs. sale price) of -5.5%.

Remaining Featured Municipalities:

4. Espinho

Average transaction price - €233,423
Average contracted rent - €1,200/month
Yield - c. 6.2%

5. Montijo

Average transaction price - €247,801
Average contracted rent - €1,270/month
Yield - c. 6.2%

6. Castelo Branco

Average transaction price - €118,702
Average contracted rent - €603/month
Yield - c. 6.1%

7. Sintra

Average transaction price - €225,518
Average contracted rent - €1,129/month
Yield - c. 6.0%

8. Barreiro

Average transaction price - €188,697
Average contracted rent - €942/month
Yield - c. 6.0%

9. Entroncamento

Average transaction price - €156,644
Average contracted rent - €779/month
Yield - c. 6.0%

10. Alenquer

Average transaction price - €156,644
Average contracted rent - €779/month
Yield - c. 6.0%

11. Marinha Grande

Average transaction price - €149,351
Average contracted rent - €737/month
Yield - c. 5.9%

12. Almada

Average transaction price - €221,154
Average contracted rent - €1,090/month
Yield - c. 5.9%

13. Torres Novas

Average transaction price - €143,223
Average contracted rent - €704/month
Yield - c. 5.9%

14. Setúbal

Average transaction price - €213,397
Average contracted rent - €1,044/month
Yield - c. 5.9%

15. Gondomar

Average transaction price - €195,379
Average contracted rent - €938/month
Yield - c. 5.8%

16. Matosinhos

Average transaction price - €255,826
Average contracted rent - €1,216/month
Yield - c. 5.7%

17. Évora

Average transaction price - €190,130
Average contracted rent - €897/month
Yield - c. 5.7%

18. Valongo

Average transaction price - €190,047
Average contracted rent - €876/month
Yield - c. 5.5%

19. Nazaré

Average transaction price - €244,720
Average contracted rent - €1,076/month
Yield - c. 5.3%

20. Santarém

Average transaction price - €193,158
Average contracted rent - €842/month
Yield - c. 5.2%

High Yield ≠ Low Risk

Municipalities like Seixal (6.6%), Moita (6.5%), and Covilhã (6.2%) top the board with impressive profitability. These high yields often reflect lower property prices, which can be attractive to investors seeking strong returns. However, they may also signal higher investment risk — such as lower demand, slower liquidity, or economic volatility.

Final Reflection: Look Beyond the Obvious

In real estate, many investors naturally gravitate toward the big cities such as Lisbon and Porto. These markets offer scale, liquidity, and familiarity. But as this data shows, some of the most profitable opportunities lie outside the traditional spotlight.

Municipalities like Seixal, Moita, or Covilhã may not be on every investor’s radar, but they offer compelling returns for those willing to explore beyond the usual map, in this case more than 50% return when comparing with the current prime yield for Residential Multifamily Lisbon City (PRS) which currently stands 4.5% according to CBRE Research.

Sometimes, the best move isn’t Rua Augusta or Avenida da Liberdade — it’s that overlooked square no one else is watching.

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