How the Eastern Algarve Property Is Winning Buyers Over Spain

The Eastern Algarve - Tavira, Vila Real de Santo António, Cabanas, Moncarapacho, Olhão and surrounding areas - is quietly becoming a magnet for Spanish and cross-border buyers. As Spain enacts tighter housing policies and mainland prices continue to rise, many are turning to the Algarve for better value, regulatory clarity, and lifestyle appeal. In this article, we explain how the Eastern Algarve is pulling in Spanish buyers, what data supports it, and what this means for sellers and investors.

Why Spanish Buyers Are Looking East (Factors & Trends)

1. Rising barriers in Spain
   
   
   • In 2025, Prime Minister Pedro Sánchez floated proposals to ban or heavily tax non-EU citizens buying property in Spain, including a potential 100 % tax on real estate purchases by non-resident, non-EU buyers.
     
     
   • For Spanish nationals moving within Spain, in many regions housing costs,especially along coasts, have escalated dramatically, pushing buyers to look beyond domestic markets.
     
     
   • These developments raise uncertainty for Spanish buyers in their domestic market, making cross-border acquisition in Portugal more attractive.
     
     
2. Relative affordability & upside
   
   
   • The Algarve’s average price in August 2025 was ~€3,467/m², up ~9.3% year-over-year.
     
     
   • In many Andalusian or Murcia coastal zones, comparable sea-view or coastal stock often carries a higher multiple due to scarcity or strict coastal regulation. The Eastern Algarve offers more breathing room for value.
     
     
   • Between lower acquisition friction, more permissive development options, and potential future appreciation, the Algarve becomes a strategic hedge.
     
     
3. Ease of access & infrastructure
   
   
   • The Algarve’s road and motorway network (A22, EN125) connect coastal east and west efficiently.
     
     
   • A new bridge project across the border (Alcoutim / Spanish side) is planned to improve connectivity, which could further integrate border towns and facilitate commuting or dual-residence options.
     
     
   • Proximity to Faro Airport and growing flight connectivity mean Spanish buyers can travel to their Algarve property more easily than many domestic Spanish buyers traveling within Spain.
     
     
4. Lifestyle & regulatory climate
   
   
   • The Eastern Algarve offers gentler density, calmer beaches and a more Portuguese “authenticity” compared to overdeveloped Spanish coasts.
     
     
   • Portugal’s real estate, tax, and property rights environment remains stable and attractive to foreign buyers.
     
     
   • AL (short-term vacation rental) licensing in parts of Portugal is clearer than in some Spanish tourist zones where restrictions are tightening; buyers who want income potential from holiday rentals may find less regulatory uncertainty in eastern Algarve (depending on municipality) than in certain Spanish counterparts.
     
     
5. Foreign buyer interest patterns
   
   
   • A September 2025 Idealista report shows that British and American buyers are heavily active in the Algarve, and international interest tends to push awareness, influencing Spanish buyers too. Idealista
     
     
   • In a broader Portugal context, the national market has seen property price growth of ~16.9% y/y in 2025. Investropa
     
     
   • Buyer demographics are widening: not just British or Irish, but German, Dutch, Scandinavian, and Brazilian nationals, this broadening of the international buyer pool increases global visibility for properties in the east.

Together, these factors make eastern Algarve a compelling alternative for Spanish buyers seeking coastal properties with upside, less regulatory risk, and quality of life.

Implications for Sellers in Eastern Algarve

• Ensure cross-border regulatory clarity
  Be ready to show Spanish buyers clear due diligence: Portuguese property tax structure, AL licensing rules, construction permit regimes, and utility connectivity.
  
  
• Segment target inventory
  Buyers from Spain might prefer quieter, larger plots, coastal-agricultural hybrids, or degree-of-completion flexibility (they may want to finish interiors themselves).
  
  
• Consider currency and financing structure
  Spanish buyers may have better access to euro-based financing - Russell & Decoz can direct you to recommended mortgage or currency advisory support.
  
  

Risks & What to Watch

• Bridge or infrastructure delays — if planned projects (like the Alcoutim bridge) stall, some buyer interest may retract.
  
  
• Changes in Spanish housing policy — Spain’s own legislative shifts on foreign buyers may deter outbound capital flows or complicate cross-border capital allocation.
  
  
• Comparative Spanish markets reclaiming competitiveness — if Spanish coastal zones adopt reforms or ease regulation, some buyers may stay on the Spanish side.
  
  
• Overexposure and pricing mismatches — if you overprice the “Spain premium,” buyer resistance grows; keep comps tight.
  
  
• Local regulatory shifts in Portugal — AL licence caps, municipality restrictions, or coastal regulation changes may introduce uncertainty for Spanish buyers used to Spanish coastal norms.

Conclusion 

The Eastern Algarve is increasingly winning property buyers from Spain and over Spain by offering a compelling trio: regulatory clarity, coastal-lifestyle appeal and relative affordability. While the flow is not yet dramatic in publicly published data, the signals and structural drivers suggest it’s a trend in early stages.

As an estate agency in the Eastern Algarve, Russell & Decoz, are monitoring these trends so we can best advise property vendors in and around the East. If you have any questions about buying or selling in this part of the Algarve, reach out to our experienced team today.