The purchase of a house in Portugal to put on the rental market yielded, in gross terms, 7.2 percent in the second quarter of 2024, an increase of 0.3 percentage points (p.p.) compared to that calculated for the same period of 2023 (6.9 percent), reveal data from idealista. Today, housing profitability is 0.5 percentage points higher than that observed in the second quarter of 2020, of 6.7 percent.

The rental market still has room to grow because the demand for houses to rent continues to be much higher than the existing supply, an imbalance that has been behind the growth in house rents. Buying houses to rent is, therefore, a business that has generated greater gains in recent years, as indicated by data from idealista.

Looking at the 13 district capitals with representative samples, it is in Castelo Branco where it is most profitable to purchase a house for investment, with a return of around 9.1 percent. But it should be noted that here too the investment risks are higher.

The other cities with the highest housing returns in the second quarter of 2024 are Santarém (8.1 percent), Coimbra (6.8 percent), Leiria (6.5 percent), Évora (6.3 percent), Setúbal (5.9 percent), Porto (5.8 percent) and Viseu (5.7 percent).

The lowest housing profitability is obtained by owners of rented houses in Lisbon (4.6 percent), Funchal (5 percent), Faro (5.1 percent), Aveiro (5.5 percent) and Viana do Castelo (5.6 percent). But here too, the investment risks are lower, as there is less chance that the house will not be rented or that there will be a devaluation of the property in the future, for example.