Property For Sale Portugal - Buyers Guide

By Author: Micky Davies
Total Articles: 3
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Portugal has been a popular tourist destination for many years and is ranked in the top 20 most visited countries, with the Algarve being the choice of destination, located next to Spain on the Atlantic Coast. The Algarve has a climate similar to that of the Spanish southern coastal towns.

The Algarve is also a popular destination for the golfing community with some spectacular golf courses such as Vale da Lobo, Penina and Vilamoura to mention a few, due to this property for sale within these areas or next to these golf courses is highly sort after. If golf is not your thing then there are the beautiful country side properties or the beach properties available.

Before you buy your property you will need to understand the process and the cost attached to purchasing a property in Portugal. The fees for purchasing a property would be approximately 5% of the purchase price and would be made up as follows: Solicitor and Notary fees, Transfer Tax known as IMT(SISA) and Stamp Duty. Notary charges are normally 1.5% of the purchase price.

The IMT (SISA) Tax payable when you purchase a property is broken ...
... down into two separate groups, permanent residence and Non-Permanent residence, the rate is detailed below:

Permanent Residence rate 2011
Purchase Price (Euros) % of tax payable Adjustment reduction
Up to €92,407 0 0
€92,407 – €126,403 2% €1,848.14
€126,403 – €172,348 5% €5,640.23
€172,348 – €287,213 7% €9,087.19
€287,213 – €574,323 8% €11,959.32
over €574,323 single flat rate of 6%

Non-Permanent Residence rate 2011
Purchase Price (Euros) % of tax payable Adjustment reduction
Up to €92,407 1% 0
€92,407 – €126,403 2% €924.07
€126,403 – €172,348 5% €4,716.16
€172,348 – €287,213 7% €8,163.12
€287,213 – €574,323 8% €11,035.25
over €574,323 single flat rate of 6%

Now you know the costs its time to buy the property and the steps involved in doing this are explained below.

When you have found a property you will enter into a contract with the Vendor, this is known as “Contrato de Promessa de Compra e Venda”, and before you sign this contract you should have your solicitor gather the relevant documents on the property.

You will also need to visit the local Tax office and register for a Fiscal Identify number as all property owners require this.

The “Licença de Utilização” License of use certificate, this will explain what the property is licensed for, a residential property would have a habitation license.

The “Caderneta Perdial” is the property tax document and this will show the yearly local taxes payable on the property, should you be purchasing a new development then this will not exist and the developer should normally issue a temporary certificate.

The “Certidão de Teor” is the property registration certificate, this is issued with a time limit on it as it shows whether there are any mortgages or leans against the property, it also describes the history and legal ownership of the property, the notary will require this certificate.

Once you have all the documents you would visit the notary to sign the contract and also lodge a 10% deposit for the property, this is a legally binding contract and if you pull out of the sale you will lose your 10% deposit, should the Vendor pull out then they have to pay double the amount you deposited.

After a few weeks, usually 3-4, you would then visit the notary and sign the Escritura for the property, at this time you would pay the final amount owing on the property and complete the deal.