Are you considering a potential relocation to Portugal? Then it’s likely that buying property is something you want to know more about. There are many different factors to consider before making a purchase.
Understanding the Market
Before your relocation to Portugal, you must have a good understanding of the property and housing market there. A few areas of Portugal’s housing market that you’ll want to brush up on include:
- The type of property you are looking for (e.g., holiday home, investment property, permanent residence)
- Your budget
- Your preferred Portugal location
- The current state of the Portuguese property market (e.g., prices, demand)
An experienced and reputable real estate agent can advise you on these aspects.
How to choose a qualified real estate agent
Portugal offers a wide variety of real estate firms, so it’s crucial to conduct your homework before selecting one. Here are some things to take into account while selecting a real estate firm:
Look for an agency with a good reputation in the industry. You can read online reviews or ask friends and family for recommendations.
Choose an agency located in the area where you want to buy property. They will be familiar with the local market and can help you find the right neighborhood for your needs.
Verify that the organization provides the services you require, such as help with finance, legal matters, among others.
Find a company that has assisted foreigners in their process of relocation to Portugal. They’ll be able to walk you through it and respond to your inquiries.
5. Legal Details
Buying property in Portugal is similar to that in other countries. The first step is usually to find a suitable property, then make an offer which, if accepted by the vendor, is followed by the signing of a preliminary contract (Contrato de Promessa de Compra e Venda).
This contract binds both parties to the sale and purchase and outlines the conditions under which the sale will take place, including price, deadlines for completion, and any penalties for breach of contract. It’s advisable to have this document checked by a Portuguese-speaking lawyer before signing.
Once both parties have signed the preliminary contract, a notary will be appointed to draw up the final deed of sale (Escritura de Compra e Venda). This document lists all details of the property transaction, including a description of the property, names and ID numbers of those involved in the sale, the price paid, and how this is to be paid.
Taxes On Real Estate Purchases
As part of the final deed of sale, you will be required to pay a stamp duty tax (formerly known as Imposto do Selo). This government tax on official documents costs 1% for properties valued over 185,000 Euros and 0.8% for those under 185,000 Euros.
You will also be required to pay capital gains taxes on any profit made from your property’s resale, whether in Portugal or elsewhere in the world.
If your property is located in Portugal, this tax is calculated at 28% and must be paid within 30 days of completion. If you don’t reside in Portugal at the time of sale, then capital gains taxes are only payable if profits exceed 160,000 Euros per family member.
Documents Required to Buy Property
When you are ready for your relocation to Portugal, there are a few key documents that you will need to make any property purchases.
- A valid passport:This is required for identification purposes when signing any legal documents related to the purchase of your property.
- Proof of address:You will need to provide proof of your current address, such as a utility bill or bank statement, to open a Portuguese bank account and complete the purchase process.
- Tax number: You will also need to obtain a tax number (Número de Identificação Fiscal) from the Portuguese tax office to complete the purchase of your property.
- Property deed:The deed (Escritura) for the property you wish to purchase must be registered with the local land registry ( Conservatória do Registo Predial). Your lawyer or notary will take care of this on your behalf.