Are you thinking of investing in Portugal? The country’s vibrant culture, stunning landscapes, and affordable real estate make it an excellent destination for anyone looking to buy a home or land.
At Travels to Europe, we believe that Portugal offers fantastic opportunities for those interested in investing in the real estate market. Whether you’re searching for a new place to call home or seeking to expand your portfolio, we’ve got you covered.
In this article, we’ll explore the different areas of Portugal that offer the best real estate options, the costs associated with buying a property, and everything you need to know before making your purchase. From the cheapest places to buy property in Portugal to the best spots for a beachfront home, we’ll cover it all.
Check our best article about Buying a House in Portugal.
To start, let’s first look at the regions where you can find good spots to buy properties. While Lisbon and Porto are popular destinations, we will avoid talking about them to provide more unusual information. If you are looking for properties in Porto, there are many homes for sale in Porto Portugal. Alternatively, if you are interested in Lisbon, you can find houses for sale Lisbon Portugal. If you prefer a location near the beach, you can look for cheap houses for sale in Portugal near the beach. Lagos is also a great place to look for apartments for sale Lagos Portugal.
What do you need to buy a house in Portugal?
Tax Number (NIF)
For this, it is necessary to register with the local tax office, having to pay a fee. If you do not have yet a portuguese address, you can provide your lawyer’s address as a mailing address.
Financing and different terms for foreigners
If your are a foreigner not resident in Portugal, you can apply for a mortgage loan for non-residents. However, you should keep in mimd that the proposed conditions will be different from those for national citizens. As a foreigner, to take out this credit in Portugal, be aware that banks can grant you a maximum of 80% of the value of the property.
The current interest rates in the Eurozone
If you are thinking of taking out a mortgage loan in Portugal, keep in mind that interest rates are on an upward trajectory, which is reflected in higher charges compared to the reality of recent years.
Effort rate cannot exceed 30%
In order for you to buy a house in Portugal, the bank needs to assess your risk profile as a customer. To do this, the banking institution analyzes your financial and professional situation, looking at your bank statement, salary, receipts, IRS statement, type of professional contract, but essentially for your effort rate.
Documents you need to Submit
Keep in mind that you will need to gather some documents so that you can take out a mortgage loan in Portugal. Such as:
- Personal identification(passport);
- Tax identification number (NIF);
- 3 last payments receipts;
- Current account statement for 6 months;
- Last income statement;
- Employment proof (employment contract declaration of effectiveness).
What is the cost associated with buying house in Portugal?
Now let’s talk about the costs associated with buying property in Portugal. Firstly, you must be aware of the basic costs, including registration fees, notary fees, and stamp duty. You can also buy property in Portugal as a foreigner, but you must comply with Portuguese regulations for housing. Additionally, you can find cheap property for sale in Portugal, which is great for investors looking for a good deal. If you want to buy an apartment in Portugal, the cost varies depending on the location. You can also find property for sale in Portugal by owners, which can sometimes result in a better price.
Moving on to the different regions of Portugal, there are several areas where you can invest in real estate. The Algarve region is known for its beautiful beaches and warm climate, making it a popular tourist destination. You can find property for sale in the Algarve region, including farms for sale in Portugal. The northern region of Portugal is more rural and has lower real estate prices compared to other parts of Portugal. In this area, you can find the cheapest place to buy property in Portugal. Madeira is also a great location to invest in real estate, with homes for sale in Madeira Portugal.
To provide you with more detailed information, I have included a table below that outlines the different costs and statistics for buying property in Portugal:
| Type of cost | Price |
| Registration fees | 1% to 2% of the purchase price |
| Notary fees | €250 to €500 |
| Stamp duty | 0.8% to 6% of the purchase price |
| Real estate prices | Varies depending on the location |
Good locations to buy a house in Portugal
While Lisbon and Porto may be the most popular cities in Portugal, there are plenty of other places to consider when investing in Portuguese real estate. Here are some of the areas that we recommend:
Algarve
Located in the southernmost region of Portugal, the Algarve is a top choice for many investors. Its sunny weather, beautiful beaches, and stunning cliffs make it a highly sought-after destination. The Algarve is home to several towns that are popular with expats, such as Lagos and Albufeira.
Madeira
If you’re looking for a serene and peaceful retreat, consider buying a property in Madeira. This archipelago is located off the coast of Morocco and offers a unique blend of Portuguese and African cultures. Madeira is an excellent destination for those seeking tranquility, with its lush greenery, rugged coastline, and stunning natural beauty.
Cascais
Located just a few miles west of Lisbon, Cascais is a picturesque seaside town that offers a more laid-back lifestyle than the capital city. This area has become increasingly popular in recent years, thanks to its stunning beaches, beautiful architecture, and vibrant culture.
Braga
Braga is a beautiful city located in northern Portugal, known for its stunning architecture and rich history. It’s also one of the cheapest places to buy property in Portugal, making it an excellent choice for those on a budget.
Coimbra
Located in the central part of Portugal, Coimbra is a historic city that’s home to one of the country’s oldest universities. This area is a great place to invest in real estate due to its low property prices and cultural significance.
Explaining the costs on buying a house in Portugal
Before you start looking for your dream home in Portugal, it’s important to understand the costs associated with buying a property. Here are some of the expenses you can expect:
Property Transfer Tax (IMT)
The IMT tax is charged by the Portuguese government when you purchase a property. The amount you’ll pay depends on the value of the property, with rates ranging from 1% to 8%.
Stamp Duty
The stamp duty tax is charged on any legal documents related to your property purchase. This tax is usually around 0.8% of the property’s value.
Legal Fees
You’ll need to hire a lawyer to help you with the legal aspects of your property purchase. Legal fees can vary, but you should expect to pay around 1% of the property’s value.
Real Estate Agent Fees
If you work with a real estate agent, they’ll charge a commission fee for their services. This fee can range from 3% to 5% of the property’s value.
Notary Fees
You’ll need to hire a notary to certify the documents related to your property purchase. Notary fees are usually around 1% of the property’s value.
Is auction a good way to buy a house in Portugal?
The average discount you can get by buying a house from an auction in Portugal can vary widely, depending on various factors such as the location, condition of the property, and competition among buyers. However, it is common for auction properties to be sold at a discount of 10-30% below the market value. It is important to note that while buying a property at auction can be an opportunity for a good deal, it also carries risks and requires careful research and preparation.
Buying a house in Portugal from auction can be a great way to find a property at a lower price than market value. However, it’s important to do your research and understand the process before jumping in.
Auctions can be a bit intimidating, but they can also be exciting and rewarding. One of the main advantages of buying a house in Portugal from auction is that you can potentially get a great deal on a property. This is because auctioned properties are often priced lower than market value in orde to attract buyers and encourage bidding.
