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Real Estate Investment in Portugal



It is very important to research all and any information regarding the property to ascertain its legal status. This includes checking that the property is properly and duly registered and licensed (or in some cases exempt from licensing) as well as making sure that the actual build corresponds to what was reported to the Town Hall.

Any person who wants to acquire a property must obtain:

a. Certificate from the Property Registry Office, that contains the description and all the registered rights upon the property;

b. Tax Authorities Property Booklet that will also describe the property and inform of its valuation for tax purposes;

c. Town Hall Utilization Licence that shows the approval of the Town Hall that the property fulfils the requirements to be used.

d. Energy Performance Certificate, describing the property’s energy efficiency and consumption expected from normal use and any measures to improve performance.

e. Technical Habitational File which is a document describing the technical and functional characteristics of the property (this only applies to more recent builds from 2004 onwards).


For a piece of land, the person acquiring the rights should check for any planning issues, restrictions and licenses with the local authorities, as well as any other regulations that may apply to the use of that land.


Rights of first refusal: depending on the location or historic and architectural relevance, properties may be subject to rights to the first refusal to be exercised, among others, by the municipal council where the property is located or by the Portuguese State (through the General Direction of Heritage). In this case, prior to the transaction, they must be given notice of the terms and conditions of the transaction. In the case of properties that are rented out, the tenant may also have a right of first refusal.


All of these aspects must be properly analyzed to ensure that the property being purchased is safeguarded from any other rights or restrictions.








In Portugal, the acquisition of property generally begins with a promissory contract.

The promissory contract governs:

The deadline for completion of the sale and purchase: this may vary depending on whether or not there is a need for the grantors to comply with any specific conditions prior to completion (obtaining permits or licenses, obtaining financing, etc.);

Price and conditions of payment: it is common for there to be a deposit of 10% of the price, which is an advance on the price and also acts as a guarantee in the event of a breach of contract (see below);

Declarations and Guarantees: it is common for the grantors to include in the promissory contract certain declarations and guarantees as to the state of the property, as to the absence of any legal actions, debts, liabilities or tax charges;

Breach: The breach of contract may provide the right to terminate the contract and receive compensation based on the amount of the deposit. If the buyer breaches the contract, the seller may keep the deposit and if the seller breaches the contract, the buyer may terminate the contract and receive double the amount of the deposit. The breach can also trigger the specific execution, meaning the non-defaulting grantor may obtain a court order to put into effect the legally agreed intention of the grantor at fault.







The promissory contract is followed by the signing of the public deed or authenticated private document (the definitive contract – completion/ closing). This is the moment where the ownership of the property is transferred. This must then be registered in favour of the purchaser.







When purchasing a property, the investor must bear in mind the charges associated with the acquisition and ownership property, in particular: Municipal Tax on Transfers of Property - Imposto Municipal Sobre as Transmissões Onerosas (“IMT”), Stamp Duty – Imposto do Selo (“IS”) and after, when purchased, the yearly Municipal Property Tax - Imposto Municipal Sobre Imóveis (“IMI”).

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