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Finding, Buying and Renting Property for Expats in Portugal

Author: Jim Newham
Submitted: November 2013

There is a wide variety of accommodation available in Portugal, and much of it is cheap and spacious, especially in the less commercial areas. Short-term accommodation is particularly in abundance (except in summer), while property for long-term rental and purchase is often thin on the ground.

Finding Property

The internet is an invaluable tool for searching for property while still in your home country and after you have emigrated. Some popular property websites for both rental and purchase are given below:

Once you have arrived in Portugal, if you can read Portuguese, you will also be able to look in local newspapers, read bulletin boards on the streets and in supermarkets and walk around areas you might want to live in. These methods are particularly fruitful for long-term rentals. If you struggle with the language, there are several English-language newspapers and magazines you can use.

Alternatively, you can call on the help of bilingual estate agents who are local to the area. Agents will look for properties, arrange viewings and negotiate with the landlord or owner on your behalf. They are particularly useful in finding long-term rented accommodation. All estate agents are licensed and insured. Nevertheless, you may want to check estate agents online and see if they are accredited with the Portuguese Estate Agents’ Association.

Note that before you rent or buy property, you will need to obtain a Portuguese tax number (NIF) at the local branch of the Finanças (tax office). You will also need to open a Portuguese bank account.

Renting

It is usual for newly-arrived expats to rent property in Portugal before making the commitment to buy. Renting property is generally cheap in Portugal, especially in the more rural areas. There is plenty of short-term rented accommodation available, though in prime tourist areas it is expensive. Long-term property for rent can be more difficult to find, especially in the high season. Most rented property is unfurnished, though some have a fitted kitchen and cupboards. Utility bills are not normally included.

Dealings with landlords, especially in rural areas, are informal, and you are unlikely to be troubled by credit checks or reference requests. However, in all cases you should check with the local council that the property has a rental licence.

Standard tenancy agreements are usually for six months or a year, though they can be for up to five years. The default length of a tenancy is two years, and the landlord can only change this in certain circumstances. The initial pay-out for tenants is moderate, with a security deposit of one month and sometimes two. In order to rent property, expats are often required to find a Portuguese guarantor, who will agree to cover their rent if they are unable to do so. Tenancy laws quite strongly favour tenants.

Buying Property

The Portuguese property market is recovering now, with sales increasing by 38% in the first quarter of 2015. While it is permitted to buy your house from outside Portugal, you will need to appoint a tax representative in the country to do so. Otherwise, having found a property you want to buy, the first stage is to make an offer to the vendor and hopefully come to an agreement on a price. Unless you are paying for the property in cash, it is prudent to start the process of obtaining a mortgage at around this point. For more details on this, see Mortgages .

At this stage your estate agent (if you are using one) will take the property off the market, to exclude other potential buyers. Next you should hire a lawyer – preferably a bilingual one, naturally. Note that you should hire a lawyer even if you are fluent in Portuguese. The lawyer will conduct initial checks on the property, and, if all are in order, then draw up a preliminary purchase contract. The signing of this and all other documents in the purchase process must be witnessed at a notary office.

Your lawyer will then find the land registry certificate (certidão do registo predial) and check its credentials match what is found on the property. The lawyer will also find a habitation licence for any property built after 1951 and make any other necessary checks. These include ensuring that you have exclusive rights to the property, or, if not, that any partial claimants deriving from past ownership do not object to the purchase. The next stage is to have a survey conducted on the property.

If no problems arise from the survey and the legal checks, your lawyer will draw up a promissory contract, which must contain formal details of the property, buyer and vendor. When the contract is signed, you pay a deposit, which will normally be from 10% to 30% of the property price. The contract is legally binding and there is a stiff financial penalty on either party that breaches it.

After this, the lawyer needs to ensure there are no other obstacles to purchase, such as outstanding debts or planning restrictions on the property. The lawyer then draws up the deed of purchase and sale (escritura pública de compra e venda), both parties sign it in the presence of a notary, and you or your mortgagee pays the balance of the money you owe. The notary will also ensure that all relevant taxes have been paid.

Finally, you need to pay for the property to be registered at the Land Registry (Conservatoria do Registo Predial) within 30 days. Once registration has been processed, the property is yours.

 

 

 




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