Buying a property in Portugal

Silver Holidays can help you find the ideal property and also help and guide you through the buying process.

When you start looking and making the initial contact be upfront and give as much information as possible on the type of property you’re looking for. The more information we have, the better chance we have of finding you a good match. 

 

Mortgages

When requiring a mortgage to help support your property purchase, we can also help if required and we have developed good working relations with banks that can lend to non-residents. Most Portuguese banks offer loans of up to 60-70% of the value assessed by the valuation report to non-residents. Portugal residents can borrow up to 85–90% of the value assessed by the valuation report. You will need the following documents when applying for a mortgage:

• Passport
• Portuguese Fiscal numbers
• Last Tax Return (P60/Self-Assessment)
• Work Contract
• Last 3 months pay slips
• Current Account Statements of the last 3 months
• Proof of savings (at least the capital that will be used for the purchase)

If you would like to receive more information on mortgages or have any questions on this please contact us at 

info@silverholidays.com

 

Lawyers

We strongly recommend using a local lawyer when buying your property who will check all the relevant paperwork of the property and make the actual buying contracts and guide you through the buying process. We can recommend various lawyers that we have worked with over the past years.

 

Portuguese Fiscal number:

The first thing that you need to do is obtain a Portuguese Fiscal number, given by the finance department of Portugal and a Portuguese bank account. This gives you an identity in the country and Silver Holidays can obtain this for you or we can recommend if required a lawyer to take care of these procedures.

To obtain a Portuguese fiscal number is quite easy and when the paperwork is in order (residency/ID card or passport) this normally can be done within 48 hours after the application.

 

Promissory Contract:

Now it starts to get serious.

The promissory contract is a binding first contract between buyer and seller (prepared by the lawyer according to Portuguese law) explaining the full purchase details such as the price, agreed completion dates, inventories and any other items that have been agreed between the 2 parties. If the buyer backs out of the transaction, after he enters into the contract he will lose his deposit, whereas if the seller has a change of heart, he must return double the deposit amount to the buyer. If he refuses, the seller can be forced legally to complete the sale.

When signing this contract the buyer(s) will need to pay a deposit of minimum of 10% up the 25% of the total agreed purchase price and a date will be set for the deal to close and the purchase to be completed.

 

The Final Deed

Almost time to celebrate.

The final deed will always be signed in front of a Notary and prepared by both lawyers, and where you will pay the final balance of the purchase, after which the property will be considered sold.  Your lawyer will do the registration of the property in the Finance and Land registry and pay on your behalf the Transmission Land Tax and the Stamp Duty.

 

Stamp Duty & Tax Transfer

 

Buyer(s) are deemed to pay upon completion taxes such as Stamp Duty and Tax Transfer. Please see as follows:

a) Stamp Duty
The stamp duty is calculated as 0,8% of the purchase price. It should be paid upon completion.
If Buyer(s) require a mortgage, it should also be noted that this is subject to a stamp duty calculated as 0,6% of the amount granted. The mortgage stamp duty is paid directly to the Bank.

b) Tax Transfer
Upon completion, tax transfer should be paid considering the purpose of the purchase.

 

Purchase price	Rate	Deducted portion
Until 92.064,00 €	0%	0,00 €
More than 97.064,00 € to 132.774,00 €	2%	1.941,28 €
More than 132.774,00 € to 181.034,00 €	5%	5.924,50 €
More than 181.034,00 € € to 301.688,00 €	7%	9.545,18 €
More than 301.688,00 € € to 603.289,00 €	8%	12.562,06 €
More than 603.289,00 € to 1.050.400€	Flat rate 6%	0,00 €
More than 1.050.400€	Flat rate 7.5%	0,00 €

If is for secondary residence:

Purchase Price	Rate	Deducted portion
Up to 92.064,00 €	1%	0,00 €
More than 97.064,00 € to 132.774,00 €	2%	970,64 €
More than 132.774,00 € to 181.034,00 €	5%	4.953,86 €
More than 181.034,00 € € to 301.688,00 €	7%	8.574,54 €
More than 301.688,00 € € to 578.598,00 €	8%	11.591,42 €
More then 578.598,00 € to 1.050.400€	Flat rate 6%	0,00 €
More than 1.050.400€	Flat rate 7.5%	0.00 €