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Buying Real Estate in Portugal

Signature Properties Solutions

Buying a property in Portugal is a simple and logical process. After you have decided on the property that you wish to purchase you need to put in an offer considering both the asking price and the purchase conditions.

It is important to consider whether your offer includes furniture, and if it does, ensure that there is an agreed inventory of the items included and excluded. Generally, there is greater flexibility in the offer if the buyer is paying in cash, has a pre-approved loan, or can complete the deal within a time frame convenient for the seller.
Once the purchase price has been agreed upon by both parties, a letter of intent will be signed. At this stage, the time frame for the next step in the process will be agreed upon. During this period, the property will no longer be shown to other clients, but it will not yet be removed from the market. If you do not already have a Portuguese tax identification number, it is important to obtain one. You can do this by contacting the tax authorities or by asking one of the many service providers to do it for you (for a fee).
The next stage of the process is the Promissory Contract of Sale and Purchase, and as the name suggests, it is a contract where one party promises to buy and the other promises to sell the property. To secure the commitment, a deposit of at least 10% of the agreed purchase price will be required, and if you change your mind after this payment, you will lose the amount paid. If the seller is the one who withdraws from the sale, they are legally required to return double the amount received. It is at this stage that the property is officially removed from the market. We will also ask you to complete a "Know Your Client" (KYC) form, which is a legal requirement.
After completing this "promise" stage, your lawyer will ensure that any preconditions are met and will schedule the signing of the deed. The remaining balance (minus the deposit) is usually paid by bank cheque. If you have not delegated power of attorney to your lawyer, you will need to be physically present at the signing. It is important to know that the notary does not verify the accuracy of the documents, as this responsibility lies with your lawyer.

Costs

There are certain costs that have to be accounted for in addition to the purchase price:

Transfer tax IMT)IMT), a variable tax function of the purchase price
Stamp duty 0.8 on the purchase price
Notary and l egal registrations etc. up to 1 5 00 Euros
Lawyers’ fees generally 1% of the purchase price

We have de veloped a calculation too l t hat will calculate the approxi mate total amount of taxes and fees to be pa id.