Buying Propery in Portugal as a non resident
Attractive weather, beautiful nature, friendly people. These are just some of the reasons why expats consider Portugal as one of the top destination to relocate. Not to mention the cost of living.
Someone asked us recently why we chose Portugal. And even if we have a myriad of motives that we put in this video if you want to watch, now, 1 year and a half after buying our property in Portugal, I think the main reason remains the cost of every day life.
Yes, we complain a lot about how expensive is Portugal for us comparing to the Romanian prices. And this statement it’s true, very true. But when looking across Europe and choosing a country where our money made in Romania can still have similar buying power, you have very little choice.
In short, Portugal was one of the few countries we afford to live with the money we make in Romania. So from this point of view Portugal has a low cost of living comparing to the rest of Europe.
Can a foreigner buy property in Portugal?
There are no restrictions for foreigners who want to buy property in Portugal. You can buy a house or land anywhere in Portugal you want.
Furthermore, the Portuguese government, in his wisdom, encourages people to invest in real estate property in Portugal through the Golden Visa program.
Golden Visa is created for non-EU citizens. If you are a non EU citizen and you invest in property worth a certain value and apply Golden Visa program, then you are allowed to live, work, and study in Portugal. Also you are allowed to travel freely across the Schengen area. In five years, you can also qualify for permanent residence or citizenship in Portugal. with this type of visa.
Typical street in Portugal
How easy is it to buy property in Portugal as a foreigner?
There are no difference, no special requirements for foreigners when buying a property in Portugal. So the process it is the same for a Portuguese as well as for you!
You must have a fiscal number (Numero de Contribuinte) or NIF to purchase a property in Portugal.
You can get this yourself at the the local tax office, if you are already in Portugal. This is for people used to bureaucracy, or people liking to tackle things on their own. Or for people who want to save money.
For people who want to obtain the Portuguese fiscal number (NIF) the easy way, you can get in touch with Bordr who have wonderful reviews and a time of completion of just 1 week from applying.
Another requirement that applies only to non-EU citizens, is that they will need to appoint a tax representative in the country. They will need a fiscal representative as long as they remain non-EU citizen. As soon as they become Portugal residents, they will no longer need this.
This can be managed by your lawyer, this being the most common practice, at least so far.
If you choose to buy the Portuguese tax number (NIF) from Bordr, the tax representative will be included in that service for the first year.
Then, if you need you can renew it, but usually, by the second year you are all set here in Portugal and registered as a resident here.
Again, EU citizen do not need this.
Getting a mortgage as a foreigner in Portugal
I could speak about this subject for hours, because we did get a mortgage in Portugal and men, we have some stories!
But as a general informations, Portuguese banks have no problem lending to foreigners. My impression is that they are happy to do it because they see the foreigners income as more secure than the Portuguese one.
Also as a general rule they will only lend 70% of the property value of the property to non-residents and up to 80% of the property value to a Portuguese resident. But this means only from the value of the house not the value of the house + taxes. The money for taxes must come from you. So you will need to have the advance and the money for all the taxes.
You could simply apply yourself at a local bank. But for my experience without a good mortgage broker, you are just going to struggle. That is the word, struggle.
Any why do it? Our mortgage broker did not charge us anything! He got his commission from the bank! Yes, there are brokers who will charge you a good amount of money (we received offers between 400 euro and 1.400 euro) for filing the application. Just look for a broker who will not charge you. A Portuguese broker.
Pitfalls to avoid as a foreign buying a property in Portugal
One of the main pitfalls to avoid when buying property in a foreign country is scams.
Look, in your country you know the way of the land, you can smell a scam from a distance. But in a foreign country with laws and customs you don’t know and understand, your senses might get confused.
First, make sure your chose real estate agent that is properly registered. All agents have to be registered with the proper body meaning at Associacao de Mediadores Imobiliarios and to have a license number.
When it comes to finding your own independent solicitor it’s also important to do your research carefully. There are 2 kinds of lawyers in Portugal: solicitador and an advogado
A solicitador is a specialist, and an advogado is a qualified lawyer.
My oppinion, go with an avogado. He is registered somewhere. He has more to lose if he involves himself in a scam. And make sure he reviews all the documents of the properly, to the last detail.
Another thing to do is to go to see the property by yourself. You need to see for yourself that the building exists on the ground and not only in rendered photos, you need to see that the property is in the same condition now as in the photos presented to you.
Story telling about this:
We wanted to buy an apartment who was more expensive with approximately 30.000 euro but it was turn key. It had everything, from solar panels, heating in all the house and remodeled, in good taste. We actually have seen the apartment a year before with our own eyes and looked good.
But in the mean time the apartment was rented long term and the renters trashed everything! This is also a reason why I don’t rent long term our apartment, I prefer to keep it empty than rent it long term.
Hire someone to give you an independent tour and opinion of the property
So if I was only to rely on the pictures and actually on what I saw a year before, I was going to buy an overpriced apartment with amentias that they had to be replaced.
This is why I say it’s important to see the apartment right before buying.
If you absolutely can be in Portugal, hire a third party! Like me for example! This third party will to go and film the property for you. Or better yet, they can face time with you while going trough the property in real time so you can see for yourself any little detail.
If you have any more questions, please leave it in the comments! Also watch this video on our YouTube Channel!
More to read on the property market in Portugal – The best places to buy property in Porto Portugal – best neighborhoods