Buying in Portugal: 4 steps

Buying property in Portugal proceeds differently than in Belgium or the Netherlands. Therefore, this article will explain the buying process through four steps.

The first step: administrative preparation

Once you have found a suitable property through an estate agent, the administrative preparation starts. For example, you will need to complete a NIF number need. This is a tax number to pay your Portuguese taxes.

Optionally, you can also already open a bank account in Portugal. However, this is not mandatory during the purchase process, but can obviously be convenient for the payment of utilities, taxes and other minor expenses.

The most important aspect of administrative preparation is the legal control of the property. When you buy a property in Belgium or the Netherlands, this task is the responsibility of the notary. In Portugal, this is not the case: you are responsible for having your property inspected.

A legal check involves examining property titles, presence of tenants, the urban planning situation and any outstanding debts and mortgages. If the legal investigation has a positive result, you can proceed to the second step.

How can you apply for a NIF number?

The second step: the compromise

Buying in Portugal, as in Belgium and the Netherlands, works with a compromise. This is the binding private deed of sale. Specific conditions can still be stipulated, such as regularisations of building violations.

Usually, after signing the compromise, you will also pay an advance of 10% of the purchase price.

The third step: to the notary

Once you have a NIF number and the compromise was signed, you are ready to go to the notary. The notarised deed of sale will then be signed, after which you will officially own the property.

The notary will also see to it that you pay the transfer taxes pay correctly. You have to pay two types of transfer taxes.

First there is the IMT (Imposto Municipal sobre a Transmissão Onerosa de Imóveis). This tax has a progressive rate of 0% up to a maximum of 6% on the purchase value of the property. There is also a registration tax of 0.8%.

Transfer taxes in Portugal are therefore significantly lower than in Belgium or Spain, for example.

Read more about taxes and costs when buying a property in Portugal.

Fourth step: registering the transfer of ownership

Once you have received the notarised deed of sale, you can register your property titles at the land registry. This is necessary to enforce your ownership rights. The notary does not register your titles.

Finally, the contracts for water and electricity will be transferred to your name.

Buying in Portugal: decision

Buying a property in Portugal is different from buying in your home country. The main difference is the role of the notary: he does not do any legal checks on the bought property, leaving you with few certainties.

Therefore, it is your counsel's job to make sure you buy safely. Confianz can guiding you through every step of the buying process, this from applying for a NIF number, to the legal handling of your investment, to transferring the water and electricity contracts.

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