Population: 10m
Currency: Euro
Exchange Rate: Click here for exchange rate details
Capital Gains Tax: Should your property be held through an offshore company no change of ownership will be recognised by the Portuguese authorities and any applicable rate of capital gains tax will be avoided. Otherwise Capital Gains will
be a maximum of 24% on property bought since 1989.
There are no Restrictions for Foreign Ownership.
Property and Real Estate Prices in Portugal
Range Varies, for example.
From around £20,000 / $30,000 for older inland properties usually in need of renovation.
From around £35,000 / $50,000 for small apartments.
From £60,000 / $87,500 for larger apartments.
Villas will generally cost from £80,000 / $115,000.
Golf complex property will be more expensive with
luxury villas approaching £200,000 / $300,000 and beyond.
Locations to buy property and real estate in Portugal
It is usually more expensive to buy real estate in coastal resorts of Portugal with the Algarve, in the South being the most popular with choices of purpose built complexes which always have a wide appeal for holiday homes and rentals. You will find the property prices are generally slightly higher than in Spain.
Living Costs in Portugal
Portugal is becoming more
expensive to live although general goods are cheaper than in other EU countries but some luxury and imported goods are quite expensive.
Buying real estate and property in Portugal
When you have found your property, the Vendor or their legal representative will obtain a certificate (Escritura) from the local Land Registry confirming that the property is available to sell. This document will need to be produced to the Notary at the time of signing the contracts.
If the full
purchase price is being paid immediately, a purchase contract will be drawn up by the Vendor's legal representative, covering the details of the contract, purchase price and date of completion. At the time of signing the contract, the Purchaser will pay a deposit usually about 10% of the agreed purchase price. If the purchaser should withdraw from the contract this deposit will be forfeited, whilst if the vendor should withdraw they will be obliged to forfeit double the value of the deposit.
Solicitor / Lawyer
The conveyancing (Escritura) will check that any searches and other legal requirements have been carried out, funds prepared and that both parties can agree a completion time. The transfer of title will then be prepared and will be signed by both parties or by their solicitors/lawyers, in the presence of a notary. The balance of the purchase money can then be handed over. The contract will be retained by the notary and a copy registered with Public Records.
You will then have to arrange for registration with the Land Registry which ensures your proof of legal ownership and the Inland Revenue will also be notified for your property and rating taxes. Prior to buying your property you should apply for a tax number.
Fees
This will usually be a total of about 15% of the purchase price, slightly less for countryside property. The costs include Solicitor/Notary fees, Stamp Duty and Transfer Tax (SISA ) when buying real estate in Portugal.
Property Tax
Property Transfer Tax (SISA), is payable when the registered owner of the property changes in Portugal. However, if buying through an offshore company, you will not have to change the name of the registered owner of the property and avoid the tax, making the purchase more attractive to a another buyer with a higher realised sale price. Over 1% per year will be paid for services, this is known as a municipal tax.
Mortgages
You can borrow against
property from a Portuguese financial institution although it can be difficult should it be for a second home by other non-Portuguese nationals. If the property is being purchased through a Gibraltar offshore company you could use a bank based there who would generally advance up to one half of the purchase price, subject to status. These mortgages can usually be arranged in most of the major currencies over terms up to a possible maximum of 20 years.
For more information on buying
property in Portugal, please visit the Portuguese Governments website:
www.min-nestrangeiros.pt
Our guide will not cover all the legal and full financial information for your Real Estate purchase but should enable you to get an idea of the financial involvement.
Portuguese Embassy
British Embassy Lisbon
Rua Sao Bernado 33
Lisboa 1249-082
Tel: +351 21392 4000
Fax: +351 21392 4185
Email: ppa@lisbon.mail.fco.gov.uk
Embassy of Portugal
Residence and Chancery
2125 Kalorama Road, NW
Washington, DC 20008
Tel: (202) 328-8610
Fax:
(202) 462-3726
(202) 518-3694
Email:
embportwash@mindspring.com
embport@mindspring.com |
