The Complete Guide of Buying Property in Portugal

May 5, 2021

To make the process of Buying Property in Portugal easier for our clients, Mann’s Solutions team has prepared a Complete Guide of Buying Property in Portugal. In this article, you will find useful information about property locations, taxes, additional costs, and the Portugal residency program.

What are the Best Locations to buy Property in Portugal?

Taking into consideration that Portugal and Madeira are some of the best places to live and retire, investment in Portugal real estate is not only profitable but is also an investment in your future. Nowadays, the property market in Portugal is well-established, continues to grow every year, and offers to sell property freehold as there are no restrictions. Below are some of the best locations for buying property:

Lisbon

Being one of the most famous cities in the country and Portugal’s capital, Lisbon provides the best opportunities for professional workers and young entrepreneurs with its large, growing, and qualified consumer market. The prime market prices of Lisbon are already around 10,000 EUR per square meter, which makes it more expensive comparing to other regions. The quality of life in Lisbon is great, there are well-developed facilities and the atmosphere of the city is magnificent. 

Cascais

Cascais, located less than an hour’s drive from Lisbon is a very important tourist destination. With a population of 200,000, the place is an excellent idea for people looking for a gorgeous coastal view. The prices for properties vary from place to place. This means that properties located nearer to the marina are more expensive than those closer to the cities. Cascais is the perfect place for high-end property and investment as the property prices keep rising and it is easy to rent out the place.

Porto

More sophisticated but still charming Porto also offers a great opportunity for the investors. The city has almost tripled the number of arriving tourists since the arrival of low-cost airlines. More than 11 million people now pass through the city and airport. Being a large city, with strong agriculture and industry, Porto is a home for 1.7 million inhabitants living around the region. It is easier to find the property there than in Lisbon and prices per square meter starts from 2,500 – 5,000 EUR. In addition to that, Porto offers an extensive transportation system and has incredible historical places, such as Clerigos Tower or the Crystal Palace Gardens.

What are the Property Taxes and Fees in Portugal?

Government and SEP (immigration office) Fees 

Government Processing Fee – € 513.75

Initial investor residency permit – € 5173.60

Property Transfer Tax – 8%

Renewal of residence permit – € 2,586.80

Residence permit for family members – € 2,586.80

Real estate stamp duty – 0.8%

Property Transfer Service – 1.5%

Citizenship application – € 250

Permanent residency application – € 350

Financial Management and Fiscal Representation – 0.5% per year

 

Portugal Property taxes

These taxes apply under Portugal Golden Visa Program if you buy real estate:

Lawyer fee – 1%

Stamp duty – 0.8%

IMI (municipal tax paid annually) – 0.3-0.5% (urban), 0.8% (rural)

IMT (Immovable property transfer tax) = 1%-6%

 

Additional Taxes

Capital gains tax – 25% (if you sell)

Rental income – taxed at 28%

VAT – 23% (included in price of new property developments)

AIMI (Wealth tax) – 0.7% for individuals (only for properties above 600K euro) and 1% above 1M euro

 

This calculation has been made in order to show the exact amount of taxes the person will have to pay by investing €280,000 euros into Property:

Stamp duty 0.8% – €2,200

Lawyer fee 1% – €2,800

IMI (municipal tax paid annually) 0.8% – €2,200

IMT (Property Transfer Tax) 1%-6% – €9,500

Total €24,000

Contact one of our experienced property consultants to view our extensive property portfolio and find your perfect home.

Portugal Golden Visa Program Overview

The Portuguese Residence Permit Program grants the right to live, work and study in Portugal, with visa-free access within the EU countries. The program investment options include the creation of at least 10 jobs via investing into business; investment of €1,000,000 or purchase of real estate within a range of €280,000 – €500,000, depending on where it was built. 

Program benefits

Portugal residency by investment program grants the applicant a 5-year residency permit and let’s apply for permanent residence and citizenship after this period. The Program requires only 7 days a year visit to Portugal in a 1 year and 14 days visit during each subsequent 2 years to keep the permit. Portugal residency allows the whole family to travel without a visa to all Schengen Zone countries and gives access to high-standard education.

– Investment from €280,000

– Low minimum stay requirements

– Access to high standard education

– Beneficial tax regime

– Profitable property investment

Investment options

Become a permanent resident of Portugal by choosing one of the following three qualifying investment options. The requirement to maintaining the investment is a minimum of 5 years from the date the residence permit is granted.

Property investment from €280,000

– €500,000 – purchase residential or commercial real estate (€400,000 – a reduced rate of 20% applied when purchasing a real estate located in low GDP or low populated density areas).

 –€350,000 – purchase residential or commercial real estate over 30 years old requiring renovation. (€280,000 – a reduced rate of 20% applied when purchasing a real estate located in low GDP or low populated density)

2. Creation of 10 Jobs or Business Investment

– Create a minimum of 10 new jobs OR

– Invest a minimum of €350,000 in business and create a minimum of 5 permanent jobs

3. Capital Transfer From €1,000,000

 Applicants are required to make a capital investment into specifically approved investment options or Portuguese bank account.

 

LONDON BASED SOLUTIONS ADVISERS – Buying Property in Portugal: Portugal Residency Program

Full Support with our Immigration Advisers & Property Consultants:

Property search based on your requirements (from residential properties to high-value luxury developments)

• Property virtual tours, 3-D tours and in-person tours available.

• Due diligence checks and additional property checks completed by our experts.

• Residency & Citizenship document preparation and submission.

• Full support until you receive your second passport & residency.

Mann’s Solutions is an international immigration law firm with offices in London, Hong Kong, and Moscow and has expertise in offering UK Visas and Immigration by Investment services to high net worth individuals. Our immigration advisers are regulated by OISC and IMC (Investment Migration Council).

For further information or to discuss your personal circumstances in a private consultation with our immigration lawyers in London Office, please contact us at enquiries@manns-solutions.com or call +44 207 993 63 46.