Dreaming of buying a property in Portugal and starting a new life under the sun? It should be an exciting experience, but for many expat buyers, the process can feel overwhelming and complicated. The legal system is different, the paperwork is in Portuguese, and the buying process differs greatly from your home country.
If you’re considering buying property in Portugal, it’s essential to understand the most common mistakes foreign buyers make and how to avoid them, whether you're buying from the UK or somewhere else. Here’s what you need to know before you sign any contracts.
Is buying property in Portugal a good investment?
Property in Portugal remains an attractive investment thanks to its lifestyle, climate, and potential for rental income. While property prices fluctuate, Portugal has shown long-term growth, and buying property here can still be a smart investment if you do your research and avoid common pitfalls.
Buying property in Portugal pitfalls for foreigners
Not knowing what you’re buying
One of the biggest mistakes when buying property in Portugal is not fully understanding what you’re purchasing. It’s crucial to research:
- Ownership history (a lawyer can assist with this)
- The local area, including amenities and neighbourhood characteristics
- How long it takes to buy property in Portugal
- Current property prices in Portugal and market trends
This is especially important if you’re buying rural property in Portugal, which often involves land, unclear title deeds, and missing administrative records. Always ensure you understand exactly what the property includes before proceeding.
Forgetting about additional costs
While property prices in Portugal can appear attractive, remember to budget for additional costs of buying property. These can include:
- Mortgage arrangement fees (which differ if you are a non-resident)
- Notary and registration fees
- IMT (property transfer tax) and stamp duty
These costs can add up to around 8–11% of the purchase price, so factor them in when calculating your total budget.
Only thinking about the summer
Many foreigners focus on buying a holiday home in Portugal and visit properties during the summer months. However, if you plan to live in Portugal year-round, consider how the area feels in the winter.
Some coastal towns, particularly in parts of the Algarve, are bustling in summer but can become quiet in winter, with many shops and restaurants closing for the season. If you prefer year-round activity, consider looking in Porto, Lisbon, Cascais or Estoril, where the coast is still accessible and local life continues throughout the year.
Avoiding real estate agencies
Some expats try to avoid using real estate agents to save on commission fees, but this can be a costly mistake. A reputable real estate agent in Portugal can:
- Help you find properties that match your criteria
- Assist with price negotiations
- Guide you through the paperwork, especially if you don’t speak Portuguese
Using a professional estate agent can save you time, stress, and even money during the purchase process.
Not seeking professional legal help
Using a lawyer in Portugal is strongly recommended, especially if you are unfamiliar with the country’s legal system or are purchasing rural property with complex issues. A lawyer will:
- Check the property’s legal status and paperwork
- Ensure there are no outstanding debts or legal issues
- Help you understand contracts before signing
Many lawyers in Portugal specialise in helping foreign buyers and speak English, making the process smoother and more transparent.
Ready to buy property in Portugal?
Buying property in Portugal can be a rewarding investment and the start of a wonderful new lifestyle, but preparation is key. Like everything, buying property in Portugal has its pros and cons, but by avoiding these common mistakes and seeking professional guidance, you can confidently navigate the process and protect your investment.
If you’re ready to take the next step, start by researching areas in Portugal with strong property investment potential, connecting with reputable real estate agents, and seeking legal advice to ensure a smooth and secure purchase. And don't forget, you can find your dream home for sale in Portugal with idealista.
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