Buying Property in Portugal

A guide to buying property in Portugal for purposes of residing or renting. Includes a brief description of life in the sunny, exotic country.

Many investors are interested in buying property in Portugal. There are many forms and legal documentation involved with such a purchase, although some will vary on whether or not the investor is planning on living in said residence permanently. As with all overseas property investments, one is advised to obtain a local lawyer to assist in the paperwork at the properties closing. Preferably, one should do his/her own research on local laws as well in order to avoid any kind of problems later.

The first step in buying property in Portugal is to visit the place in person. All investors, should they plan on living in Portugal or not, need to see their investment in person. There are many licensed real estate agents throughout the country that can assist a potential buyer with his/her property hunting. One should make a checklist of things they are looking for in real estate, such as whether they want the property to be close to the water or a golf course. A real estate agent will do his/her best to find a suitable place.

While looking at property, an investor should do some local research, as every area can be a bit different. Researching local school systems, police departments, crime statistics and other information can also play a part in an investors decision. Areas heavy in tourism may be asking a lot more for property, but renters can also ask for more from future tenants. Once a property is chosen, one should probably attain a Portuguese lawyer that is in no way associated with the real estate agency or the property owner. This will ensure that the lawyer has only his/her clients best interest in mind.

An investor should seek legal advice on whether or not to put the property in his/her own name. Some may wish to buy property in a business name or jointly with an investor. After deciding this, an investor may wish to obtain financing through a mortgage lender. On average, a mortgage loan in Portugal covers 60-70% of the final purchase price. Should one purchase a property in Portugal, yet doesn’t plan on living there, he/she must file as a non-resident. This will involve more paperwork and require a person to appoint a local representative in Portugal to handle finances.

Buying property in Portugal should be a pleasant affair for investors and European buyers should be pleased to know that Portugal deals in Euros, so there will be no surprises later when the exchange rate is applied. Likewise, European citizens will be afforded some benefits there that non-Europeans won’t receive. A healthy real estate market with an influx of tourists each year, buying property in Portugal is considered to be a sound investment for people of any financial status. Overseas property investment is no longer reserved for the rich and famous, contrary to popular belief.

Written by Amy Cottrell for

Sunday 23rd July 2006

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