Tips on buying a house in Portugal
From minimum deposits to required legal documents, blogger Samantha Milner offers pointers to those planning to buy a home in Portugal.
Whether you are looking to buy or rent property in Portugal either one can be as stressful as the other. No matter which one you choose, it is a necessity that you have both a fiscal number and a resident’s number as even landlords won't accept you without it.
If you want to buy a house and get a mortgage in Portugal, expect to have to put a minimum deposit of 10% down. Plus, you will have to have worked in Portugal for a year before you will be allowed one.
If any of your property details are in Portuguese or you don't understand them, go and visit a solicitor to put your mind at rest. This will save you signing a contract that you don't understand and that might cost you more money later on.
Some points to consider before buying in Portugal
When moving to Portugal, many people jump straight in and purchase a property that they have seen at one of the property exhibitions that they have visited in their home countries.
I would advise against this because once you have moved to Portugal, you will come across many private property sales where you will get a much better deal.
So to start with, it may be a good idea to rent a property whilst you are getting your bearings, so to speak. You will find that there are plenty of short term lets available and if you are looking to buy a property this kind of thing should suit your needs ideally.
Make sure that you have a signed lease agreement that details everything required. You will usually find that a month’s rent is required in advance with a month’s rent also required as deposit.
Once you are settled, you may want to start looking for a property to purchase but you must make sure that you are well prepared as the buying system differs somewhat from elsewhere.
When buying a property in Portugal it is obviously very important that you are aware of the correct procedure to take. When purchasing a property the contract is known as the contrato de promessa de compra e venda.
This is a legal document which details the conditions of the sale and is handled by a notary who is a public officer assigned to carry out this type of legal work. When this contract has been signed, the buyer has to hand over a deposit which usually amounts to between ten and twelve percent of the total cost of the property.
A unique feature of this contract in Portugal is that if the buyer decides not to continue with the contract, they must pay the seller a penalty charge of twice the amount of the deposit that they paid in the first place. This, in effect, ensures that sales very rarely fall through and it is very unusual to find this level of protection anywhere else other than in Portugal.
General view of houses in Lisbon
Another aspect of the property buying process that is unique to Portugal is that the purchaser must obtain a fiscal number from the nearest tax office. This rule applies whether you are a foreigner or indeed a citizen of Portugal, but it is an extremely straightforward process and is simply a case of filling in a form and handing it in to the tax office. The whole process of completing on a property purchase in Portugal is far quicker than in the UK and it is not uncommon for the whole process to take around five weeks.
Samantha / Expatica
Samantha is a blogger from the U.K. who moved to Portugal in 2008 after growing fed up with the way of life in England. She writes that the Algarve still has her heart more than two years on. She keeps a regular blog at livinginthesun.info.
Find a house in Portugal using Expatica's housing search.
Need advice? Post your question on Expatica's free Ask the Expert service to see if we can help.
Comment here on the article, or if you have a suggestion to improve this article, please click here.