Selling a property in Madeira in 2026: prices, regional tax and agents

What is a property in Madeira worth?

Two sets of figures matter. INE (the national statistics office) publishes the median price per m² actually paid in completed sales, taken from tax records. idealista publishes the average asking price per m² on its listings. Asking prices run well above sale prices everywhere in Madeira, and far above them in the west, where many recorded sales are older rural houses while the listings are mostly new villas.

Area	INE median paid, 12 months to June 2026	Change on a year earlier	idealista asking, August 2026
Madeira (whole region)	€2,690/m²	+5.1%	€3,795/m² (Madeira island)
Funchal municipality	€3,538/m²	+10.4%	€4,042/m²
Funchal: São Martinho (Lido, hotel zone)	€4,230/m²	+4.3%	€4,374/m²
Funchal: Sé (city centre)	€3,863/m²	−3.2%	€4,381/m²
Funchal: São Pedro	€3,324/m²	+24.6%	€3,614/m²
Funchal: Monte	€1,839/m²	+13.4%	€3,139/m²
Santa Cruz (incl. Caniço)	€2,853/m²	+19.1%	€3,076/m² (Caniço €3,271/m²)
Câmara de Lobos	€2,464/m²	−6.9%	€3,300/m²
Calheta	€1,865/m²	+20.8%	€4,495/m² (Arco da Calheta €4,623/m²)
Ponta do Sol	€1,767/m²	−3.9%	€3,783/m²
Porto Santo	€2,410/m²	+7.2%	€3,835/m²

The year-on-year changes are our calculation from INE’s database, against the 12 months to June 2025. INE publishes parish figures only for Funchal. idealista changed its methodology in July 2026, so do not compare these asking prices with older idealista figures.

Across the region, apartments sold for a median €3,532/m² and new-build homes for €3,265/m², against €2,571/m² for existing homes (INE, same period).

Is 2026 a good time to sell in Madeira?

The market has slowed on three measures.

• Fewer sales. Madeira’s statistics office (DREM) counted 3,303 home sales in 2025, down 13.5%, then 665 in the first quarter of 2026 (down 25.6% on a year earlier) and 672 in the second (down 15.2%). INE’s first-quarter release put Madeira’s fall at 24.2%, the largest of any region in Portugal.
• Slower price growth. The Madeira-wide median paid rose 5.1% in the year to June 2026, against 17.7% for Portugal as a whole. Funchal rose 10.4%.
• Asking prices have flattened. idealista’s Madeira island average peaked at €3,802/m² in March 2026 and stood at €3,795/m² in August. Annual growth fell from 17.7% in September 2025 to 8.8% in August 2026.

Pockets are still rising fast on asking prices: Arco da Calheta (+30.2% in a year), Estreito de Câmara de Lobos (+51.2%) and Porto Santo (+25.3%).

The 7.5% tax on non-resident buyers. Since 25 May 2026, buyers who are not Portuguese tax residents pay a flat 7.5% IMT (property transfer tax) on a home (Decree-Law 97/2026, article 17(10) of the IMT Code). The law makes no exception for Madeira. Because Madeira’s IMT brackets for resident buyers are 25% higher than on the mainland, the gap is wider here: on a €400,000 flat, a non-resident pays €30,000 and a resident buying a second home €16,257. That hits the part of the buyer pool that pays most: buyers with a tax address abroad paid a median €3,611/m² in Madeira in the second quarter of 2026, 29.7% more than buyers based in Portugal (INE). No one has yet measured the effect on Madeira sales; the tax has only run for four months.

Who is buying in Madeira?

In 2025, buyers with a tax address outside Portugal made 10.0% of Madeira’s home purchases (5.7% from the EU, 4.3% from the rest of the world) but 16.2% of their value, according to DREM. They also pay more per m², as the INE figures above show. Neither source gives nationalities. Among foreign residents of Madeira at the end of 2025, the largest groups were Venezuelan, Brazilian and Nepalese, followed by German (1,354) and British (1,192) (DREM). Indirect signals come from the agencies themselves. Several Funchal and Calheta agencies describe themselves as German or have German-speaking teams, and others market to expats, retirees and remote workers. Ponta do Sol has hosted a Digital Nomad Village, run by Startup Madeira with the regional government, since February 2021. Treat these as signs of who agencies are courting, not as market shares.

How long does it take to sell?

We found no reliable figure for time on the market in Madeira. Once you accept an offer, the steps are the same as on the mainland: a promissory contract (CPCV) with a deposit, then the deed (escritura) on the date the CPCV sets. The full process for owners living abroad, including signing through a power of attorney, is in selling as a non-resident.

How is the sale taxed in Madeira?

A common assumption is that Madeira’s lower income tax applies to anyone selling property on the island. It does not.

• Madeira residents. Since 1 January 2026, Portuguese tax residents who live in Madeira pay IRS (income tax) at 70% of the mainland rates, from 8.75% to 33.6%, instead of 12.5% to 48% (Decreto Legislativo Regional 8/2025/M, amending DLR 3/2001/M). Until 2025 the 30% cut applied only to the lower brackets. To count as resident in Madeira you must be tax resident in Portugal, spend more than 183 days a year in Madeira and have your habitual residence and tax address there (article 17 of the IRS Code).
• Non-residents. The regional table applies only to Madeira residents. An owner who lives abroad is taxed exactly as on the mainland: 50% of the gain at the national progressive rates (12.5% to 48% in 2026), with the rate set by reference to worldwide income. There is no withholding at the deed; the gain goes on the following year’s Portuguese return. See capital gains tax for non-residents.

Worked example. A flat bought in 2016 for €250,000 is sold in 2026 for €480,000. The seller has no other Portuguese-taxable income in the year.

Step	Amount
Sale price	€480,000
Purchase price × inflation coefficient 1.19 (2025 table, provisional)	−€297,500
IMT and stamp duty paid on the purchase (assumed)	−€8,000
Agent commission 5% + 22% VAT	−€29,280
Energy certificate	−€250
Gain	€144,970
Taxable half	€72,485
Tax at national rates (non-resident, or mainland resident)	about €23,887
Tax at Madeira’s regional rates (Madeira resident)	about €16,721

A non-resident with other income abroad will usually pay more than €23,887, because the rate is set by reference to all their income. UK residents also report the gain in the UK and get credit for the Portuguese tax; see UK residents selling.

Our selling calculator uses the national rates. That is right for non-residents; if you are a Madeira resident, your tax will be about 30% lower than it shows. The exemptions for reinvesting in a main home, and the new rent-reinvestment exemption for 2026 to 2029, apply in Madeira as elsewhere; see the rent-reinvestment exemption.

What does selling cost?

Cost	On a €480,000 sale
Agent commission, 5% (negotiable)	€24,000
VAT on commission at 22% (Madeira rate)	€5,280
Energy certificate (typical)	€150–350
Land registry certificate (online) and tax record (free on Portal das Finanças)	small
Early mortgage repayment fee, if any	up to 0.5% (variable) or 2% (fixed) of the amount repaid

VAT in Madeira is 22%, not the mainland’s 23%, because the regions may set lower rates (article 18(3) of the VAT Code) and agency services on a property are taxed where the property is. On €24,000 of commission that saves €240. The buyer pays IMT and stamp duty, and normally the deed and registration costs. See costs of selling for the full list.

Local rules sellers must know

Short lets in Funchal. Funchal had 3,359 holiday-let (alojamento local, AL) registrations at the end of 2025, 42% of Madeira’s total. After suspending new registrations in 2025, it adopted a regulation (Regulamento 787/2026, published in the Diário da República on 29 June 2026, in force the next day). In Sé parish, the city centre, no new AL registrations are allowed. In Funchal’s other nine parishes, new registrations are allowed only for a whole house, or rooms in a house, with its own entrance. Limited exceptions cover rehabilitated old or long-vacant buildings, up to six units per building, and they don’t apply if the home had a residential lease in the previous two years. So an existing AL registration on a Funchal flat is now scarce: say so in the listing, and ask your lawyer whether it can pass to a buyer. Madeira adapted the national AL law in Decreto Legislativo Regional 13/2015/M. See selling a short-let property.

Funchal’s building plan. Funchal’s municipal plan (PDM, in force since April 2018) is being revised, and parts of it were suspended with preventive measures from July 2026 (Aviso 39/2026/M/2) for up to two years, extendable by one. If your sale depends on a buyer being able to build or extend, get the council’s planning information first.

Protected land. The Madeira Natural Park covers about two-thirds of the island, including the Laurisilva forest, a UNESCO World Heritage Site since 1999. Rural plots inside it face strict limits on building.

Licences. From 1 October 2026 (Decree-Law 108/2026), every deed must state whether the habitation licence was shown, declared to exist, or does not exist. Pools and extensions on terraced plots often lack approval; sort this out before listing. See unlicensed works.

How to choose an agent in Madeira

Madeira has franchise offices (Century 21, ERA, Keller Williams, RE/MAX, Sotheby’s) in Funchal and independent agencies in Funchal, Caniço, Calheta and Ponta do Sol, some of them German-speaking. Check each AMI licence on the IMPIC register, ask for recent sales rather than asking prices, and keep an exclusive contract to three to six months. Our list of English-speaking estate agents in Madeira sets out offices, licence numbers and segments, without ranking them. For contract terms, see estate agent commission. For the region as a whole, see the Madeira hub.

Key points

• Funchal homes sold for a median €3,538/m² in the 12 months to June 2026 (+10.4%); Madeira as a whole €2,690/m² (+5.1%). idealista asking prices: €4,042/m² in Funchal, €3,795/m² island-wide (August 2026).
• Sales fell 13.5% in 2025 and 25.6% in the first quarter of 2026 (DREM), and asking-price growth has halved in a year.
• Madeira residents pay income tax on gains at 70% of mainland rates from 2026; non-residents pay the national rates.
• VAT on agent commission is 22% in Madeira, not 23%.
• The 7.5% IMT on non-resident buyers applies in Madeira, and the gap to resident buyers is wider than on the mainland.
• Since 30 June 2026 Funchal allows no new short-let registrations in Sé and, elsewhere in the city, mainly only for houses with their own entrance.