Pitfalls buying Property in Portugal

Avoid any troubles, buying a property in Portugal pitfalls can be easily circumvented by requesting support from local experts.
Article Last Updated: 08 Oct, 2023 under Property Purchase

If you are interested in buying property in Portugal, you should be aware that some issues could potentially arise, which we detail below:

 

1. Who owns the property to be sold?

First, you must find out if the owners of the property are the real owners and that the property has no debts or else you could find yourself responsible for repayment debts. These checks must be carried out both before signing a promissory contract (contrato de promessa de compra e venda) and before signing the deed of sale (escritura).

Particular care must be taken when considering the clauses in such contracts – they may be described as ‘standard’ but contain clauses that are anything but! The best policy is not to sign anything that your lawyer has not reviewed first.

It is not uncommon for those buying property in Portugal as a foreigner to let down their guard and agree to things that they would never do at home, for example make an informal deal in a bar or restaurant with a person who seems all too credible in the moment, but is nowhere to be seen when a deposit payment has been made.

2. Illegal deals as pitfalls buying Property in Portugal

Another issue that can frequently arise is for the vendor to suggest that you pay part of the price ‘under the table’ - thus lowering the price declared to the tax authorities and reducing the vendor’s capital gains tax liability. While you would also benefit from saving money on taxes and fees, don’t forget that you will have a higher capital gains tax bill when you later sell the property. Bear in mind that if you’re selling a house and the buyer refuses to make the ‘illicit’ payment after the contract has been signed, you will have no legal redress! This practice is of course strictly illegal and is not a clever way to reduce the costs of buying property in Portugal!

Other errors that buyers typically make in Portugal is to buy in the wrong area instead of renting first. Unless you know the area well, it would be advised to take your time to look around and know the territory. Portugal is a small country and it doesn’t take too much time to go up and down, and the roads are good, so you have a chance to find the best place for you to live.

Be careful also when buying a property for renovation as there is always a danger of grossly underestimating the restoration costs.

If you want to build a house on land you have bought it is always better to request the appropriate planning permission information from the local council - to make sure you are allowed to do what you want to – before you buy. Otherwise you might end-up very disappointed if the permission is denied and you are forced to change your plans drastically.

Take your time and be cautious: beware the aforementioned pitfalls buying property in Portugal and don t let the seller or the real estate agent pressure you into a quick purchase that you might regret later!

Our Lawyers

Cláudia, Lawyer in Castelo Branco...
I am a Lawyer, working independently for 7 years now. I have experience in family law, property, public deeds, criminal law and general matters. I'm my work I sometimes do translations and certifications of foreign documents. I although have experience in teaching.
We used Claudia’s service when immigrating to Portugal. Process started in UK with visa applications. Claudia dealt with all documents required, applying and obtaining our NIF numbers, setting up our tax status and assisting with opening our Portuguese bank account. When we arrived in Portugal, we rented a property for six months. Again, Claudia assisted with contract and relocation. We bought a property in August 2023. Claudia dealt with all conveyances, exchange contracts and through to completion. She has also helped us with Portuguese driving licenses healthcare insurance and registration on Portugal's health system. Also done translation of important documents. We found her work to be impeccable and all times. Moving to a new country and new language is quite a daunting process. Claudia made us feel at ease at all times and reassured us when ever we were unsure or nervous about pending meetings/appointments with immigration officials. In our opinion, we could only recommend her services at 100%+++ Finally. She is a true professional. Meetings and her offices, we were always greeted with a friendly smile and warm welcome. We continue to use her services.
Greg Nicholl
Greg Nicholl
11 Mar 2024
Trustpilot Review
66 completed cases
Speaks languages Speaks SpanishSpeaks FrenchSpeaks PortugueseSpeaks English

Call us Now

Opertor
Office hours
9am - 9pm CET Monday - Friday