The cost of living in Portugal is moving up to par with other European nations since it joined the European Union in 1986. Portugal is considered a developed country that scores high on the Human Development Index. Prices of goods have gone up but salaries of people also made up for the constant inflation. A post in the Portugal Expat Forum last February 2009 states that:

"I dont think things are as bad here in Portugal as in the uk, mainly because Portugal doesnt move that quickly so in the last couple of years, we have not had the huge roller coaster changes that other countries have experianced, so things just move along more or less as always"

As of the present, living in Portugal can be ideal if an expatriate gets to have a steady job earning around 1,000 euros every month. Compared to the United Kingdom, prices of commodities, rentals and leisure are still slightly lower. Living in the capital city will definitely be more expensive but the northern areas of the country still have several cheaper wares and places to offer. This is due to the increased prosperity in Portugal , with higher salaries and increased cost of living in the country.

Overall, the cost of living in Portugal heavily depends on the location as well as the lifestyle of the individual. It is possible to live comfortably if one chooses the right areas to sustain both needs and wants. Portugal’s economy was ranked 40th in total GDP at over 230 billion euros. Per capita GDP is estimated to be around 23,000 euros, which enters the country at 34th place overall. Income equality is considerably good and the country still enforces free market. Standard of living according to the Economist Intelligence Unit or EIU puts Portugal at the 19th spot in terms of quality of life.

Food and Drinks Costs in Portugal

Portugal used to rely heavily on trade although in recent years, export has begun to decline in comprising the bulk of the economy. As of now, there are still several agricultural and food products available at moderate prices. The cost of food in Portugal is much cheaper compared to other Western European countries, with rates as much as 300 Euros in feeding two adults for a month.

Expatriates can enjoy cheaper goods in the countryside as well as in the coastal areas since these places harbor rich raw materials fresh from the ocean. Seafood in Portugal is very abundant and also affordable. There are varieties of ocean bounty such as shrimp, crab, mackerel, sardines, bass and tuna. If buying at local wet markets, prices are considerably low but the rates after due tax will increase if sold at supermarkets and shops.

Wine is also abundant in Portugal since several regions make and distribute it locally and for export purposes. Red, white and green wine is available in most wineries and home cellars. Prices depend on the quality, age and maker. Expatriates may be able to find Port wine at very reasonable rates but buying at commercial wine shops will surely be expensive. Portugal also makes several varieties of cheese and these are available at very affordable prices. Meat products like beef, lamb and pork are moderately priced just like poultry and eggs. The average Portuguese spends around 150 euros every month on food and drinks.

Clothing and Accessories Costs in Portugal

Clothes and accessories are cheaper in Portugal than in the UK. People may have noticed that prices of goods and commodities have gone up. Quality clothes made locally are expensive and are particularly manufactured for export purposes along with other textiles like wool, silk and cotton. At bargain shops there are also more affordable wares and accessories.

Cars, electronics and computers are also slowly rising in costs but expatriates may still comparably see the cheaper difference. Imported goods are expensive in Portugal but there are many who still prefer to purchase locally made products. Designer labels in commercial establishments are pricey as well as those in department stores and boutiques. Street vendors and flea markets offer considerably lower rates but the quality of these goods is questionable.

Housing Costs in Portugal

Major cities in Portugal like Lisbon and Cascais have high costs of living but several rural areas are still open at affordable rates. A single person can live comfortably earning 1,000 euros every month. About 300 to 500 euros can get quality rental space inclusive of water supply, electricity and gas consumption.

Resort living is significantly cheap but the location may also be the reason for high unemployment rates. Big cities are conducive for business owners since these have excellent resources and communication links. Most expatriates prefer living in the heart of Lisbon in a more expensive apartment than living out in the country.

Land and home ownership is easy to come by in rural areas especially for foreign investors. There are some taxes needed to be paid before due ownership. Owning land in the countryside can be reasonable in terms of price too. After the recent crisis, several suburban houses have been laying dormant waiting for renters and buyers. In rural areas, although unemployment rate is high, majority of Portugal’s total population are actually located there. Several families living in the city also have an extra house in the country which explains why there are more houses than people in Portugal.

There has been an increase in property market activity with the development of golf resorts in the tourist destinations of Portugal, such as Algarve and Albufeira. This aims to increase the number and quality of both temporary and permanent visitors to the country.

Services Costs in Portugal

Portugal has recently been in shortage of medical professionals but their standard of health care in terms of service and equipment are still good. Public hospitals are partly subsidized by the government and most Portuguese have insurance policies that are well supported. Transportation in major cities is excellent and well maintained.

However, rural areas still need more work in terms of road accessibility. It is not that convenient to travel from one region to the next considering the transportation services at the moment outside Lisbon. Within the urban areas , the transport system is both cheap and reliable, with a wide network within the major cities of the country.

A lot of public schools are available in urban, suburban and rural areas are subsidized by the Portuguese government. Some problems lie with high illiteracy rates at almost 8% as well as dropout rates. There are also a number of excellent universities that are linked with established educational institutions in the United States and the United Kingdom. On the other hand, students can opt for Polytechnic courses.

Another aspect that needs to be considered is healthcare and insight was shared at Portugal Expat Forum last May 26,2009 saying:

“healthcare is ok, on a par with the UK with a few exceptions. You have to pay 2-ish euros to see your GP and you also have to pay a contribution to your medications, this differs between medicines. If you can tell me what you are taking I will try to get you a price from our local Farmacia. The language is difficult but not impossible, there are plenty of classes around including free ones at Sao Martinho do porto. The driving, what can i say but, holy moly. You have been rightly informed.”

Employment Costs in Portugal

Overall, Portugal has an unemployment rate of 7.6% which is the 48th lowest all over the world. The income equality and economic freedom are still in good condition. The unemployment rate is at 6.7%, which is low compared to others in these bleak financial times. GDP per capita is also stabilizing at over 22,000 euros. Portugal needs more people to help its growing need of health care. Business investors from foreign countries are also welcome. Exportation of wine, cork, textile and furniture are the new economic trends of Portugal unlike before when it heavily relied on agriculture and fishing. Recently, it is also making its move in the stock market and business arena that expatriates may find promising in seeking employment.