About 200 Americans now live in Madeira, part of a vibrant expat community on this beautiful island. The place has won the ‘Best Island’ title several times at the World Travel Awards.
Life in Madeira gives you a perfect mix of safety and value for money. The island’s map has changed since 2021. Monthly utilities cost around €100, which is reasonable. Rental prices in Funchal have seen the most significant changes. A one-bedroom apartment costs €1,500 now – twice what you’d pay in 2020/21. The island’s warm weather throughout the year, almost zero crime rate, and excellent healthcare system (ranked 13th best in Europe) make it a top choice for expats who want a balanced life.
This piece covers all you need to know about starting your life on this Portuguese island. You’ll learn about housing costs, healthcare choices, and other essentials to help you decide if Madeira is right for you.
The Current State of American Life in Madeira
Madeira hit a new record with 14,060 foreign residents in 2023. The island’s international community now includes 452 Americans who have made this beautiful Atlantic island their home.
Population trends in 2025
Foreign residents make up 5.5% of Madeira’s 256,622 total population. Americans live here among people from Venezuela, the United Kingdom, Brazil, and Germany, who are the foundations of the expat community. The United States has become one of the top contributors to this growth, adding 1.4 percentage points to the rise in foreign residents.
Most popular areas for Americans in Madeira
Funchal, the bustling capital, is home to 52.6% of all international residents. Santa Cruz follows with 13.0%, and Calheta houses 9.4% of the foreign community. These neighbourhoods offer unique benefits to Americans:
- Funchal: A city with great amenities and uninterrupted connections
- Calheta: A peaceful retreat with modern living
- Ponta do Sol: The “Sunniest Point” that digital professionals love
Types of Americans Moving to Madeira
Americans in Madeira come from different backgrounds, and each group finds something special about island life. Here’s who they are:
- Digital Professionals: The Digital Nomad Village in Ponta do Sol continues to thrive in 2025. Remote workers have become key members of the international community.
- Retirees: Tax rules changed when the Non-Habitual Resident (NHR) tax regime ended in January 2024. Yet American retirees still choose Madeira for its affordable living and available healthcare.
- LGBTQ+ Community: The island welcomes LGBTQ+ individuals who feel comfortable publicly expressing affection.
The international community has grown younger compared to past years when British and German retirees dominated. English education starts in primary schools here, making it easy for Americans to fit in.
Americans with passive income often use the D7 Visa to move here. The D8 visa works well for remote workers hired by companies outside Portugal. The Golden Visa is a great way to get residency through real estate investments.
Daily Reality of Island Living for Americans in Madeira
Life on Madeira Island combines modern living with old-world charm and provides everything you need daily. Let me walk you through what to expect:
Transportation and getting around
The SIGA network brought a fresh change to Madeira’s public transport in July 2024 with 127 eco-friendly buses. Three leading operators run this unified system: Companhia de Autocarros da Madeira (CAM), Siga Rodoeste, and Horários do Funchal. Travelers can now take direct busses twice daily from Funchal to Pico do Areeiro starting August 2024.
Shopping and errands
Funchal is the island’s shopping hub, mixing traditional markets and modern stores. The historic Rua Dr. Fernão de Ornelas buzzes with vintage shops and new businesses. You’ll find several shopping centres that cater to your daily needs:
- Madeira Shopping: This largest mall comes with free parking and shows movies in their original language
- Forum Madeira: You’ll find this centre in Lido’s tourist area, complete with a supermarket and cinema
- La Vie Funchal: Three floors packed with shops, a pharmacy and plenty of food options
Healthcare
The island ranks fourth in Europe when it comes to doctor availability. The healthcare system runs through three main facilities:
- Dr. Nélio Mendonça Hospital: This main facility provides round-the-clock emergency care
- Marmeleiros Hospital: The go-to place for critical care
- Dr. João de Almada Hospital: Specializes in care for elderly and palliative patients
Every civil parish has its health centre that handles routine care, vaccinations, and family planning.
Schooling for Americans in Madeira Island
American families can choose between two excellent international schools:
The International School of Madeira teaches kids aged 3-10 through a bilingual British-Portuguese program. Classes stay small, with no more than 12 students. The International Sharing School welcomes students aged 3-16 from 23 countries. They follow the International Baccalaureate system and teach in English and Portuguese.
Cost Changes Since 2021
Property prices in Madeira have changed dramatically, indicating a significant change in the real estate market.
Housing market development
Bank appraisals for housing in Madeira hit €2,000 per square meter in January 2025. House prices jumped by 17.4% during October 2024. Properties on the southern coast now match the price appreciation rates of significant mainland cities.
Funchal is the priciest area, where apartment prices average €3,230 per square meter. Despite that, buyers can find more budget-friendly options as prices vary widely between parishes. Sé’s prices reach €3,846 per square meter, while areas beyond Funchal show much lower rates.
New buyers should know that property prices are 56% above rents and 47% higher than household income. Cash buyers still hold strong cards at the negotiating table.
Daily expenses comparison
Living costs in Madeira have changed a lot over the last several years. Rent has increased sharply – modern one-bedroom apartments in central Funchal now cost €1,500 monthly, up from €700 in 2020/21.
A single person spends about €100 weekly on food. Grocery costs stay nowhere near what people pay in major US cities – they’re 89% lower. Essential items cost less: bread (€1.23), eggs (€2.36), and local cheese (€8.37).
Eating out remains affordable. Mid-range restaurants charge €15-25 per person. Local tascas are a great way to get value through set menus that include soup, main course, and coffee for €10-15.
A couple needs €2,700 monthly to live comfortably, though this can reach €3,600 with luxury amenities. Consumer prices and rent run about 14% lower than Lisbon’s rates.
Taxation in Madeira island
Madeira’s tax system allows Americans to benefit from unique advantages when they move to the island. Understanding these tax rules plays a vital part in making this transition successful.
Personal Income Tax
Personal income in the Autonomous Region of Madeira is subject to progressive tax rates from 10.15% to 47.52%. The taxable income above €7,479 is split into two components. The first part matches the higher bracket’s limit and gets the average rate, while the remaining amount receives the standard rate.
The Portuguese State Budget has significantly changed personal income tax benefits starting in 2025. Tax exemptions now apply to productivity bonuses up to 6% of annual base salary. Meal allowances through vouchers now get a 70% tax exemption, which raises the exempt amount to €10.20.
Corporate Income Tax
Madeira sets its standard corporate tax rate at 14.7%. Small and medium-sized enterprises pay a lower rate of 11.9% on their first €50,000 taxable income. A regional surtax applies at these graduated rates:
- 2.1% on profits between €1.5M and €7.5M
- 3.5% on profits between €7.5M and €35M
- 6.3% on profits exceeding €35M
Madeira International Business Center
Companies licensed through December 31, 2026, can enjoy unique tax benefits from MIBC until December 31, 2028. These entities start with a reduced 5% corporate tax rate. They need to meet specific job creation requirements to qualify for tax benefits:
The taxable base maximum varies with job creation:
- €2.73M for 1-2 jobs
- €3.55M for 3-5 jobs
- €21.87M for 6-30 jobs
- €35.54M for 31-50 jobs
- €54.68M for 51-100 jobs
- €205.50M for over 100 jobs
Businesses must meet one of these annual limits:
- 20.1% of annual gross value added
- 30.1% of the yearly labour costs
- 15.1% of annual turnover
This regime gives businesses an 80% exemption on stamp duty, property taxes, and municipal charges—non-resident shareholders who live outside Portugal or blacklisted jurisdictions don’t pay taxes on dividend remittances.
Conclusion about Americans in Madeira Island
Moving to Madeira as an American brings both exciting opportunities and real challenges as we look toward 2025. Rental costs have doubled since 2021. A one-bedroom apartment in Funchal now costs €1,500 per month. The island remains a great value when compared to major US cities.
Madeira’s charm continues attracting Americans, with more than 450 residents calling it home. The island welcomes everyone from digital professionals who love Ponta do Sol’s sunny climate to retirees looking for quality healthcare and peace of mind. The Non-Habitual Resident Tax Program ended in 2024. However, the Madeira International Business Center still provides attractive benefits for entrepreneurs.
Life here perfectly blends modern living with island character. Getting around is easy with the new SIGA transport system. Healthcare facilities are excellent, and international schools serve the community well. Living costs have increased, yet a couple can live comfortably on €2,700 monthly. Consumer prices stay well below what you’d pay in Lisbon.
Consider your needs, budget, and ideal location before moving. Each neighbourhood has its appeal. Funchal buzzes with city life. Calheta offers peace. Ponta do Sol attracts a vibrant digital community.
FAQs About Americans in Madeira
Q1. What is the current American population in Madeira?
As of 2025, approximately 452 Americans call Madeira home, forming part of a growing international community on the island.
Q2. How affordable is living in Madeira compared to the United States?
While rental prices have increased significantly since 2021, Madeira remains more affordable than major US cities. A couple can maintain a comfortable lifestyle for about €2,700 monthly, with consumer prices, including rent, staying almost 14% below Lisbon’s rates.
Q3. What are the most popular areas for Americans in Madeira?
Funchal, the capital, attracts the largest concentration of foreign residents. Other popular areas include Santa Cruz, Calheta, and Ponta do Sol, which digital professionals particularly favour.
Q4. How is the healthcare system for Americans in Madeira?
Madeira boasts an excellent healthcare system, ranking 13th best in Europe. The island has three main hospitals, and each civil parish maintains a health centre for routine care, offering a high doctor-to-patient ratio.
Q5. What visa options are available for Americans moving to Madeira?
Popular visa options include the D7 Visa for those with passive income, the D8 Visa designed for remote workers employed by companies outside Portugal, and the Golden Visa for investment-based residency, which is particularly attractive for real estate investments.
The founding of Madeira Corporate Services dates back to 1995. MCS started as a corporate service provider in the Madeira International Business Center and rapidly became a leading management company… Read more
