Portugal's Tourism Accommodation Sector Rises in 2023

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Published on 15 February, 2024 • Last updated on 15 February, 2024

By Portugal Homes

Portugal's Tourism Accommodation Sector Rises in 2023

In a promising recovery sign for Portugal's tourism industry, the accommodation sector experienced remarkable growth in 2023, surpassing pre-pandemic levels in most regions, except for the renowned Algarve.

According to data from Statistics Portugal (INE – National Institute of Statistics) released on the 14th of February, the tourism accommodation sector welcomed 30 million guests and recorded 77.2 million overnight stays in 2023, marking a substantial 13.3% and 10.7% increase from the previous year. Total revenues surged by 20.1%, reaching a significant milestone of 6 billion euros. Portugal celebrated a tourism resurgence, especially in the country's capital Lisbon. In the overall picture for 2023, the most remarkable growth unfolded in the Autonomous Regions of the Azores and Madeira, both boasting a tremendous +14.3% surge. The Lisbon Metropolitan Area was not far behind, showcasing a commendable +12.2% rise.

Despite an overall increase in the number of guests, the Algarve experienced a 2.5% decline in overnight stays, remaining the only region unable to reach pre-pandemic levels, even though the numbers are showing a gradual recovery. Simultaneously, Lisbon has become a beacon in the European Real Estate landscape. Comparing 2023 to the pre-pandemic year 2019, Portugal witnessed a 40.2% surge in total revenues and a 43.0% increase in accommodation revenues. This positive news puts Portugal once again at the top of European countries for Real Estate Investments.

Lisbon is one of the best cities in Europe to receive investments

The 2024 Emerging Trends in Real Estate in Europe report, produced by PwC and the Urban Land Institute, positions Lisbon as one of the most attractive European cities for Real Estate investments. In just two years, the Portuguese capital climbed a remarkable 8 positions, moving from 16th place in 2022 to an impressive 8th place in 2024. Driven by the increase in tourism, the Lisbon Real Estate market rises as a massive investment opportunity. This rise underscores confidence in the Portuguese property market, suggesting stability and the potential for further growth. With Lisbon being the country's main economic hub, the city's appeal extends to both Portuguese citizens and expats, making it a sought-after destination for real estate investments.

Beyond its real estate success, Lisbon's charm lies in its laid-back lifestyle and entrepreneurial spirit, solidifying its reputation as the best place for foreigners to live in Europe. The city's property market outlook for 2023 already showcased a significant rise in property values, and the 2024 report suggests this trend is set to continue and grow. However, challenges loom as market regulations begin to take effect, evident in the shortage of real estate products for sale. The convergence of a thriving tourism sector and a booming real estate market paints a promising picture for Portugal's economic recovery. As the country navigates the complexities of a post-pandemic era, Lisbon stands as a testament to resilience, economic growth, and international appeal.

The Algarve Region Recovering as The Main Touristic Destination 

Detailed analysis from INE reveals that the Algarve, traditionally Portugal's primary tourism destination, retained its status in terms of the number of overnight stays. However, a 3.4% reduction in market share from 2019 to 2023 signals a shift in tourist preferences.

The report sheds light on monthly trends, indicating that January 2023 marked the first month of growth since the onset of the pandemic in the Algarve.

However, the region experienced successive declines from May to September, particularly notable in the high season. The fourth quarter saw a resurgence, with increases in October (+7.3%) and November (+4.6%). Foreign guests played a pivotal role in the overall growth, with a 3.0% increase in their numbers. However, their stays were shorter, resulting in a 4.2% reduction in the average length of stay. The British market, the primary contributor with 37.0% of non-resident stays, dipped by 1.8%. Meanwhile, the American and Canadian markets saw substantial growth of 70.3% and 26.9%, respectively.

Portugal’s Real Estate Market Benefits from Tourism Surge

The rise of Portugal's tourism sector and the subsequent growth in international appeal has benefitted the country's Real Estate market and has put Portugal in the spotlight for international investments for years to come.

However, this surge has also brought a more negative impact with the discontinuation of the Real Estate option for the Portugal Golden Visa. Nevertheless, other Residency by Investment options exist in Portugal which are open for non-European nationals seeking EU residency. The Portugal D2 Visa, for instance, is currently the fastest option for residency acquisition in the country.

Portugal Homes’ specialists have prepared special D2 Visa investment options with an exclusive opportunity in Mátria, a co-working space located in the Lisbon city centre, just streets away from the famous Avenida da Liberdade. This investment of €280k is the perfect pathway to the Portuguese Residency and Citizenship.

The tourism sector's growth, as evidenced by the surge in overnight stays and total revenue, contributes significantly to the positive trajectory of Portugal's real estate and foreign Investment demand. Lisbon's ascent to become one of the top European cities for investments further highlights the synergy between tourism and the population. With a depth of knowledge and an intimate understanding of the ever-evolving market, Portugal Homes guides investors through an informed decision-making process, ensuring a seamless journey from exploration to acquisition, inviting savvy investors and those envisioning Portugal as their new home.


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