Rising Cost of Living No Longer Worth it? - Living in Portugal in 2024
Portugal’s rising cost of living has made it less appealing as a destination for expats and those hoping to move abroad. Once known for its affordable lifestyle, the country now faces rental prices akin to or approaching those in Northern Europe, but with much lower average salaries. This can create significant financial challenges for locals and foreign residents alike. Previously, Portugal offered a lower cost of living for those with income from abroad, but this advantage seems to be fading away.
Recent policy changes have added to the uncertainty. The Non-Habitual Residency (NHR) tax regime, which provided substantial tax benefits for new residents, is no longer available to most newcomers. Additionally, the status of golden visas remains in flux, with ongoing debates about their potential cancellation. These factors make it increasingly difficult for many to justify moving to or staying in Portugal based solely on financial incentives, even though the country remains a wonderful place to move for those who love the Portuguese lifestyle.
For those on a fixed income or working remotely, it’s crucial to weigh the cost-benefit balance carefully. Other European countries like Spain, Greece, Albania, and Romania are becoming more attractive due to their lower living costs or emerging incentives. Each person's decision will vary based on their financial situation, career needs, and personal preferences.
Inflation and rising property prices, seemingly driven by foreign investment on top of inflation, have compounded the high cost of living in Portugal. Many locals face higher rents than in the past, with some property owners hoping for foreigners to pay premium prices. Despite these challenges, opportunities still exist, particularly for those in specific careers or with unique financial circumstances.
Comparing the cost of living in Portugal to other European countries reveals a mixed picture. Public transportation and some services might be cheaper, but overall monthly expenses, including groceries and dining out, are starting to become comparable to or even higher than in Northern Europe. This disparity makes it essential for potential expatriates to carefully consider their financial and lifestyle needs before relocating.
In conclusion, Portugal's increasing cost of living poses significant challenges, particularly for locals and those earning local salaries. However, for individuals with income from abroad, it remains a viable option, even though it may not be as advantageous as before. Thorough research and comparison of options are necessary to ensure the best fit for personal and financial circumstances.