In Portugal, people follow the concept of ‘full ownership’, which entails the right to full and exclusive ownership of a real estate property. The focus on this system of property ownerships gives the Portuguese real estate industry an advantage over most comparable real estate industries on the continent.

The normal buying procedure involves three steps:

1 – Reservation: Once the buyer has chosen a property and their offer is accepted by the vendor, a reservation deposit of €6,000 is usually paid and the property is taken off the market.

2 – Promissory Contract of Sale and Purchase: Not long after the deposit is paid, both buyer and vendor enter in a promissory agreement, which is legally binding, whereby all the details of the sale and purchase are established. The buyer will also pay a further deposit of around 20% of the total purchase price minus the reservation deposit.

3 – Public Deed: Upon completion, the Public Deed will be signed in front of a Portuguese Notary, who will issue certified copies of the corresponding entry and this serves as official proof the transaction has been made lawfully and at this stage the balance of the agreed purchase price is paid in full.

With the Public Deed and all the transaction completed, it is necessary to register the new owner of the property into the Land Registry. At this stage you are the owner of your Portuguese property and it’s time to start living the dream!


Buying costs associated with a property purchase in Portugal vary based on the price of the property and sometimes the type of development. They include:

- Property Transfer Tax: this is calculated by the higher value of either the value of the deeds or the rateable value. The rate is variable, but can go up to 8%.

- Stamp Duty: you are required to pay this on contracts, deeds, bank mortgages and loans, documents, and titles and are the responsibility of the buyer. The rate of stamp duty varies according to the type and the value of the property. The rate according to the type of deed/operation is 0.8%.

- Lawyers Fees: A lawyer can take care of all the legal issues involved in purchasing a property in Portugal. They will look after your interests at all stages of the transaction, making sure that all licenses are in place, that the contracts are in order to be signed and they will clarify any legal questions that you may have. Lawyers Fees are typically 1% of the property purchase price.

- Notary & Registration Fees: these will have to be paid by the buyer on completion and vary between 1% and 2% of the purchase price.

We estimate the costs between 7% and 8% of the purchase price. When you reserve a property in Portugal you are given an exact breakdown of the costs involved so you are able to plan ahead.
As a Non-Portuguese resident, you are liable to tax on your Portuguese sourced income and a married couple is taxed jointly. When you purchase a property in Portugal you be subject to the taxes described below:

- Rental Tax: If you decide to rent your property out, you will be taxed on that net rental income at a flat rate of 15%, which is withheld at the source.

- Municipal Tax: The person that owns the property on the last day of the respective tax year is liable to pay the Municipal Tax, which ranges from 0.2% to 0.8% for urban properties, whereas properties in rural areas are taxed at 0.8%. Some properties are exempt from Municipal Tax for a period between 3 and 6 years, depending on the patrimonial value of the property.

- Property Management: This can be anything from an occasional property check to full services including rentals, payment of bills, pool and garden maintenance, maid and laundry service, airport transfer, etc. Depending on the type of package you are looking for, this can cost anything between €500 and €1,000 per year.

- Utilities: The cost of electricity, water, gas, telephone, television and Internet depends on the size of the property, the number of inhabitants, the location, appliances and the type of tariff contracted. However, according to, the yearly utility costs for an 85m2 apartment are around €1,300.