Buying Guide Details
Buying Property in Portugal’s Cities
Overview
Though many people looking for a property in Portugal will be attracted by the fabulous beaches, high-quality golf courses or the tranquility of its rural hinterland, there will be some drawn to urban living in one of Portugal’s cities. After all, the location and size of Portugal’s major cities means that these other resources are never too far away – why not have the best of all worlds?
There are regular flights from the UK and Ireland to Portugal’s two largest cities, Lisbon and Oporto (Porto). Thanks to good motorway connections, smaller cities such as Coimbra and Braga are within easy reach of the airport hubs. Refurbished properties are the most popular coice in the cities, though there are some new developments in the pipeline aimed at overseas property investors, located outside of the protected historical centres.
With such a long and rich history it is no surprise that the cities of Portugal are great cultural centres with art, architecture and places of interest dating back centuries. But you are never very far away from the country’s great natural treasures too, its beaches and countryside, and the city centres are easily commutable from the suburbs and provinces. Thanks to investment in transport and telecommunications, the country’s cities no longer lag far behind some of Europe’s other major metropolitan areas, and signs are good for the long term for anyone seeking a property in urban Portugal.
The Process of Buying Property in Portugal’s Cities
- The first step is usually a verbal agreement between the property buyer and seller, after which the property buyer’s lawyer should carry out all necessary checks – title, building licence, etc
- A preliminary contract is then signed, which lays out the terms of the sale, including the completion date. At this point a deposit is paid, usually of 10%. This deposit is forfeited if the property buyer backs out, and if the seller withdraws he/she must pay the property buyer double the value of the deposit, i.e. 20%
- On completion both parties sign the deeds (escritura) in front of a notary and ownership is transferred. The balance of the purchase price plus all fees and taxes must be paid before the escritura can be signed
- As soon as possible after signing the deeds, the transfer of title should be lodged in both the land registry and the local tax office
- If buying property in Portugal’s Cities off-plan a smaller deposit is usually required, followed by stage payments. This depends entirely on the developer
- When buying property in Portugal’s Cities that is resale property, make sure a survey is carried out in addition to usual checks.
Homes Overseas Property Club
Homes Overseas has joined forces with a collection of IFA specialists to form the Homes Overseas Property Club (HOPC), designed for existing and prospective overseas property homeowners.
The Club – which has access to international lawyers in no fewer than 43 different countries - has been set up in order to guide people through some of the various issues relating to buying and maintaining a property overseas. It offers advice on a range of topics, including financial, legal, insurance, taxation, property management and foreign currency matters.
For further information please telephone 0845 838 7142 or email info@homesoverseaspropertyclub.com
Fees & Taxes
- Transfer tax can be anything up to 8% depending on the value of the property in Portugal’s Cities. This must be paid before the final documents are signed
- Legal fees tend to be around 2%
- Agents’ fees can be anywhere between 1% and 10%, although the average is around 3%
- Allow around 2.5% for notary and land registry fees and up to 0.8% for annual local taxes
- Fees and taxes can vary greatly depending on the municipality, so be sure to get your lawyer to check out the relevant legislation thoroughly
- VAT at the current rate of 19% may apply. Get your lawyer to find out what fees this affects.
Buying property in Major cities