Sunny beaches, low taxes, a relaxed pace of life — the Algarve is one of Europe’s top destinations for retirees, digital nomads, and property investors. But what’s it really like to live there in 2025? Let’s explore the best towns, real prices, and insider tips for expats.
- Why the Algarve attracts expats
- Cost of living in the Algarve (2025 update)
- Rental and property prices
- Best places to live in the Algarve
- Lagos — cosmopolitan and creative
- Tavira — authentic and peaceful
- Faro — practical and connected
- Albufeira — touristy but convenient
- Silves and Monchique — inland escapes
- Weather and lifestyle
- Pros and cons of living in the Algarve
- Who the Algarve is best for
- Final thoughts
The Algarve, stretching along southern Portugal, is far more than a holiday region. While millions visit each year for its beaches, more and more foreigners are settling there permanently. Whether you’re looking for sunshine, lower taxes, or a safe environment, the Algarve offers a lifestyle unmatched elsewhere in Western Europe — but with a few trade-offs you should know before packing your bags.
Why the Algarve attracts expats
- Over 300 days of sunshine per year
- English widely spoken, even in small towns
- Excellent infrastructure and healthcare
- Safe, clean, and friendly environment
- Lower cost of living than France, Spain, or the UK
The Algarve is particularly popular with retirees from the UK, Netherlands, Germany, and Canada — but also with digital nomads and remote workers drawn by fast fiber internet, international schools, and easy air connections from Faro Airport.
Cost of living in the Algarve (2025 update)
The Algarve remains affordable compared to other Mediterranean regions, but prices have increased since the pandemic. Realistic monthly budget examples (excluding rent):
- Single expat: €700 – €1,000
- Couple: €1,200 – €1,800
- Family with kids: €2,000 – €2,800
Groceries are slightly more expensive than in Lisbon or Porto due to transport costs, but local produce — fish, fruit, olive oil, and wine — remains cheap and excellent quality.
Rental and property prices
Rental prices depend heavily on location and season:
- Lagos: €1,000 – €1,800 (2-bedroom)
- Albufeira: €900 – €1,600 (2-bedroom)
- Faro: €800 – €1,400 (2-bedroom, near airport/university)
- Tavira: €850 – €1,300 (charming and less crowded)
- Portimão: €850 – €1,400
Buying property is still cheaper than in the French Riviera or Costa del Sol. Average price per m² in 2025: €3,500 – €5,000 near the coast and €1,800 – €2,800 inland.
Best places to live in the Algarve
Lagos — cosmopolitan and creative
Lagos combines historical charm with a lively expat scene. You’ll find art studios, yoga centers, coworking cafés, and beaches within walking distance. It’s one of the best-balanced towns for long-term living.
Tavira — authentic and peaceful
Tavira retains a traditional Portuguese soul. The town is full of tiled houses, cobbled streets, and riverside cafés. It’s quieter, ideal for retirees or remote workers looking for calm beauty.
Faro — practical and connected
As the regional capital, Faro has the best infrastructure: international airport, hospitals, and universities. Prices are slightly lower, and it’s excellent for those who travel often.
Albufeira — touristy but convenient
Albufeira is lively year-round and filled with restaurants, shops, and nightlife. It’s ideal if you enjoy energy and proximity to beaches, though it’s more crowded in summer.
Silves and Monchique — inland escapes
For those seeking a quieter life, Silves (a historic inland town) and Monchique (a mountain village with thermal spas) offer stunning views, low prices, and strong community spirit.
Weather and lifestyle
The Algarve enjoys one of Europe’s best climates. Winters are mild (15–18°C), summers are hot but dry (28–33°C), and evenings are cool thanks to the Atlantic breeze. The sea is swimmable from May to October.
Outdoor life dominates: golf, hiking, surfing, and sailing are part of everyday life. The region also has many international schools and excellent private healthcare, making it family-friendly.
Pros and cons of living in the Algarve
Pros:
- Sunshine, safety, and lifestyle quality
- Affordable healthcare and utilities
- Warm, welcoming people
- Stable property market and rental demand
Cons:
- High summer tourism and crowded beaches
- Fewer cultural events than Lisbon or Porto
- Limited public transport in smaller towns
- Higher seasonal prices for rentals
Who the Algarve is best for
- Retirees: excellent healthcare, safety, and calm atmosphere
- Digital nomads: co-living hubs, fiber internet, global community
- Families: private schools, bilingual education, community vibe
- Investors: stable long-term rental yields and tourism demand
Final thoughts
Living in the Algarve in 2025 offers a balance of comfort, sunshine, and financial stability that few places in Europe can match. While tourist hotspots can be busy, smaller towns and inland areas remain peaceful, authentic, and affordable. Whether you’re retiring, working remotely, or investing, the Algarve remains Portugal’s golden region — literally and figuratively.
Last updated: November 2025.
