FREQUENTLY ASKED QUESTIONS

Your lawyer will check for you if ownership registration documents are correct. It is also checked if the property is free of (bank) debts, (government) claims or outstanding taxes, further if the local authority has approved architectural plans and its project matches what the customer is purchasing.

You will sign the so-called “contrato promessa da compra e venda”, the Promissory Contract, you promise to buy and sign the final contract of sale(“Escritura”, Deed) based upon the conditions mentioned in the Promissory Contract. Although it is not forbidden to buy without Promissory Contract(hence go straight to Deed) this contract is used in almost all property change of ownership rights transactions and naturally is legally binding, it specifies in its clauses all the arrangements agreed upon to come to signing Deed including amounts others the agreed date for completion and payment scheme.

Although there are no legal implications about the amount of an initial payment, 99% of all Promissory Contracts run with a down payments of 10% of the total purchase price. The Promissory Contract will naturally be signed by both parties either in person or by their legal representatives in possession of a Power of Attorney to so.

Payment of property transfer tax, the so called “IMT”. For urban real estate there are fixed rates and scales up to an amount of € 550.836,—, above this amount applies a rate of 6%. If the purchase of a property is by a permanent resident of Portugal, there is a small discount.

Building plots, commercial and service properties pay 6.5% and rustic land 5%.

The stamp duty is 0.8% of the price declared for the property in Deed

At the notary office the transfer of change of ownerships rights of the property is officially celebrated in the “escritura”, Deed, signed again by both seller and purchase or their legal representatives. For this act at the Notary a fee of approximately € 325 to € 450 is due, payable by purchasing party.

Registration in the land registry is normally done by your lawyer. A registration fee of € 225 to € 250 will be charged at the Land Registry Office.

Your lawyer will also take care of registering at the local tax office. The name of the purchaser(s) is linked to the property in the matrix register of this public entity.

Yes, a bank account is needed to at least be able to be used for paying utilitity services(eg. water, electricity, gas, insurance). You can ask your lawyer to open one or of course open a bank account yourselves .

Property owners pay an annual property tax called “IMI”, which is a percentage of the property valuation amount carried out by the tax department. Urban real estate pay 0.3% to 0.5% of this registered real estate valuation and rural land 0.8%.