Cost of Living in Portugal

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This is the first in a series of two articles exploring the real cost of living in Portugal.

A couple of weeks ago, a reader of the blog asked me to write a post going into detail about the living costs in Portugal.

Given that the questions most frequently asked on the expat forums tend to be around the whole issue of living costs and the chances of employment and likely remuneration, I thought this was a great idea – so I have decided to write a pair of articles detailing our experiences so far. Next time, I am going to explore the employment situation.

I’m sure there will be some differences of opinion so I would emphasise that the costs of living are specific to US and WHERE we live. We are in the Algarve where prices are at their highest and things are very different in Central Portugal and the north of the country. I’m sure any readers living in what they are sure to describe as “real” Portugal will be happy to comment about any differences in costs up there, and I will be grateful for their contributions.


We rent our apartment at the moment and I would recommend this strategy to anyone moving to a new country. If we had purchased the mouldy damp disaster that was our first home in Portugal, we would still be regretting it now!

Down here in the Algarve you can get a good, modern 2-3 bedroom apartment for around 500-600 euros per month – go back ten miles or so into the hills and you could potentially

Portugal - small villa with pool
Portugal – small villa with pool

find something “rustic” to live in for 350 euros. “Rustic” could well mean too cold in winter and too hot in summer!

1000 euros plus and you start getting into detached villas with private pools – the further you go from the main tourist areas and the front-line of the beaches, the more you get for your money.

I’m not going to get into the purchase prices of property in this post – a quick internet search will tell you far more than I could.


From what I have read on forums, utility bills in Portugal can vary wildly, but here are our experiences, based on two of us in a two bedroom apartment, with guests staying around 25% of the time.

Electricity can range from 30 euros on a quiet month with just the two of us at home, to 95 euros in August with 3 guests and 3 air conditioning units running rather a lot! In Portugal the TV licence is incorporated into the electricity bill.

Mains gas is quite rare in older properties – if you have a gas stove or oven in these properties then your cost is for the bottles, which cost about 18 euros to fill each time. We have mains gas and it costs about 25 euros per month for the hob and water heating.

Water and drainage, for us, is about 35 euros per month.

My wife reliably informs me that our utilities are a fair bit less than they were in London.


Taxation in Portugal is a minefield, as it is in any country – but I can tell you what I have learned so far!

First off, if you are renting a property then there is NO council tax to pay. Having come from London’s second most expensive borough, this is a BIG saving for us. Property owners do pay an equivalent tax – my understanding is that is substantially less than the UK’s council tax – perhaps a reader can clarify.

Income tax is high here but it is balanced by the fact that married couples combine and share their allowances, and more things (such as your rent and mortgage interest) are tax deductible.

Social security is also high – if you are employed by a Portuguese company this isn’t so much of a concern but the self-employed are clobbered significantly – arguably without getting that much for their money – especially compared with the welfare free-for-all that Great Britain “benefits” from 😉


This one gets terribly contentious on the forums so I will tread carefully!

Sardines - live like the locals
Sardines – live like the locals

If you are prepared to live like a local, you REALLY CAN enjoy far smaller grocery bills living in Portugal. Fresh fish and fruit and vegetables from markets can be had for wonderfully low prices. If you stick to chicken and pork, meat is cheap too and of excellent quality.

As for wine, well, suffice to say we have a choice of red, white and pink that we love for €1.50 per bottle or less. We consider it as truly “pushing the boat out,” if we buy a €4 bottle!

When the costs can rapidly escalate is when you start to reintroduce the things you miss from home or convenience foods. Heinz Baked Beans can be €1.60 per tin. An Old El Paso Taco Dinner Kit, for when you have a craving for something Mexican, can set you back 7 EUROS…..and that ISN’T a typo!

Another thing to be aware of in Portugal is the huge price disparity between some of the supermarkets. It has taken us nearly a year to have a good idea of what to buy where, to get the best value. Of course this takes effort, and you see many expats filling their trollies with things they could get for half the price if they went to the markets or even just a different supermarket.

It all depends on the effort you want to put in and whether you are genuinely intending to live and eat like a local. A lot of people end up not doing so – which is why some people on the forums argue that food and drink is more expensive in Portugal.

We spend around €300-400 per month on groceries in Portugal, and for that we can eat like kings!


Cars themselves are SHOCKINGLY expensive, and a significant factor when you consider the costs of living in Portugal. €4000 euros here will get you the equivalent old banger that £1000 will get you at home. It is hard to give an average insurance cost, but we found this didn’t differ dramatically from the UK prices.

A couple of key differences though—here you insure the car, rather than the person driving, leaving you a lot more free to allow others to drive your vehicle. Secondly, it is near impossible to get anything other than third party insurance for any vehicle over 10 years old. Another factor to consider if you do buy that €4000 banger!

Petrol, at the time of writing around €1.40 per litre, is some of the most expensive in the world. On the bright side, car tax is much lower.

Public transport, after coming from London, is almost laughably cheap. A train trip from Tavira to Faro is a couple of euros, and an intercity journey up to Lisbon around €25.


We, along with other expats, have private health insurance. It is not an essential, but it gives peace of mind. This can cost anything from €100-€400 per month for a couple, and from what I have heard, age makes a significant difference to the cost.

One thing we love about Portugal is that the climate and setting means the things we love doing – walking on the beach, swimming etc. cost us nothing.

Those seeking the kind of entertainments that are popular in the UK – cinema, bowling etc. will find pretty low prices – around €5 for a cinema ticket.

Much the same as the shopping, entertainment all depends on the leg-work you are prepared to put in. There was recently an offer in our local shopping centre which gave you a full meal with wine at a choice of eateries and a cinema ticket for just 8 euros each.

Similarly, if you shop around, rustic local restaurants, often offering far better food than their expensive, touristy counterparts, offer fixed price meals at laughably low prices. A place near to us does a three course meal including coffee and a jug of wine for 7 euros per person!

None of this means you don’t frequently end up in touristy areas, especially when friends are visiting, being rinsed for 6 euros at a time for poor quality cocktails! Living in Portugal on the cheap is very much dependant on common sense and self-discipline – and I’m still a sucker for an overpriced caipirinha somewhere with a sea view!

That brings me onto another important expense – those frequent friend and family visits. Although visitors almost always pay their way, the fact is the endless weeks of sharing peoples

Visits home are expensive
Visits home are expensive

holidays DO cost a LOT more than being at home on your own. Rounds of drinks, filling up the wine rack, airport runs, boat trips…..I could go on. Having visitors is wonderful, but it’s not cheap.

Just the same: trips back to the UK….flights, hotels, trains, all of those restaurant meals you have in order to catch up with people you haven’t seen for ages, trips to the supermarket to stock up on products you can’t get in Portugal. I have yet to go back to England for a few days without spending twice what I planned. It’s just the way it is.

I’m going to finish off with the actual costs of a few random items – some of which may surprise those who don’t live here, just to give a bit more of a taster of the cost of living in Portugal.

If you wish to ask any more details, or find the costs differ a lot in your part of Portugal, please leave a comment.

A bottle of beer in a local bar – €0.80
A bottle of beer in a tourist beachfront bar – €2
6 x fresh sardines from the market – €1.50
A kilo of frozen raw jumbo prawns – €8
A bottle of mouthwash – €6
A bottle of brand name shower gel – €4
A plate of clams – €10

Part two of this short series of articles can be found here at Finding work in Portugal

If you are serious about a move to Portugal, you really should invest in our essential book, and not just because my wife and I wrote it!

Moving to Portugal: How a young couple started a new life in the sun – and how you could do the same

Find it here if you are in the US or Canada.

Also, check out my own Portugal Web Directory for a host of useful web links.

Image credits: Joaoa WexDub

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16 Comments - Write a Comment

  1. Many thanks Ben ,a very comprehensive article which confirms a great deal.It is obvious we share a similar outlook on how we wish to experience the move to Portugal.I just still can,t get my head around vehicle purchase costs given the average wage there?! Anyway look forward to your follow up article and future blogs and hope you receive some interesting replies. Regards

  2. Hi Tim,

    A lot of Portuguese people finance car purchases over a large number of years – allowing them to spread the huge cost of a decent car over sometimes as many as 10 years. On the bright side, the climate means cars here are a lot less prone to rust!

    Best wishes

  3. Hi Ben,
    A very good write up , i live in Madeira and all the prices you quote are more or less the same here. I would like to add to shopping that toiletries and other non foods like washing powder are very expensive, razor blades are a crazy price, but we are starting to see cheaper brands, but if you want named brands expect to pay a lot more than the uk.

    Also property tax, as a first time buyer in Madeira we have been exempt from this for 8 years, then the price on a 2 bed apartment will be about 300-400 a year, so a lot less than the uk.

    Great blog and really enjoy reading it.

  4. I’ve only just found your blog and have read a couple of pages with interest. You’ve done a hell of a lot of work and I look forward to reading some more.

    I sell property in Portugal and if I can help or assist you or your readers in any way, let me know.

    All my best.

  5. thanks for a straightforward piece of information,straight to to point well condensed.We have thought of Crete as an option
    but now thinking it is too far away. I will not fly so Portugal appears more attractive as we would drive there.
    Looking at year,who knows, things will change!
    Thanks Rob ps I will be watching you.

  6. Hi Rob,
    Thanks for reading….yep, with not flying Crete would be quite a mission I imagine – at least here you have various driving options as well as a train!

    Best wishes and good luck for your move

  7. Hi,

    Thanks for the excellent website. Your information is spot on although I’m from the beautiful city of Porto, in the north, where, on balance, things like rent and entertainment, such as eating out, is marginally cheaper. I have to ask though – does anyone know why toiletries and electrical goods are so much more expensive here in Portugal? It seems like we’re being ripped off! :S

    Thanks again for all your hard work!
    Best wishes,

  8. Hi Gail,

    Thanks for reading.

    I wonder if it is perhaps that most toiletries are imported, at least from Spain, wheras other European countries may have factories of their own. We tend to get all of our toiletries (and medicines) during work trips to the UK. If we do need to buy things in Portugal we go to shops like De Borla and Lidl instead of paying the supermarket prices.

    In terms of electrical goods, Portuguese law does mean that they have to come with a 2 year guarantee, which goes some way to explaining the price difference.

    They are my theories anyway!

    Best wishes,


  9. Hi Ben 🙂
    I’m planning on moving abroad, and haven’t decided where yet. Basically I just wanna go anywhere south of Denmark where I live now, preferably somewhere where they speak Spanish.
    I talked to a guy yesterday who lived in southern Portugal back in 1997, and he said that everything was so cheap you could easily live for 500 pounds a month. I just read your blog post, and this doesn’t seem to be true anymore then, but have the prices changed that much over the past 20 years?

    Best regards

  10. Thanks your information.
    I want to ask more about living with my wife and a child.
    will it be ease for us, if you both earn and live with good life and little saving.
    I am confuse about moving to portugal having PR but i dont what to do,.
    Will we be able manage easily, infact we both are educated, i have IT field experience and degrees.

    Thanks in advance.

  11. I think the big question in terms of whether you can make a living is whether you can speak Portuguese? 🙂

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