The influx of foreign investors has sparked a notable boom in the Portuguese real estate market. With year-round sunshine, excellent living standards, top-notch cuisine, and high-quality healthcare and education, it’s no wonder international families and expats are flocking to buy property here.
The great news is that foreigners enjoy the same rights as Portuguese citizens when buying and owning property in Portugal. There are no legal restrictions based on nationality so you can purchase land, apartments, houses, and commercial properties just like a local.
In this ultimate guide to buying property in Portugal, you’ll get all the insights and information needed to make your real estate purchase confidently and easily.
Portugal has become the top choice for real estate investors, and for good reason. Here’s why the Portuguese real estate market is an attractive and profitable investment opportunity:
Yes, you can! Foreign investors are not restricted from purchasing property in Portugal, and the country has relatively open and straightforward regulations regarding property ownership by non-residents. The property acquisition process in Portugal is designed to be accessible and transparent, making it easier for international buyers to navigate the steps involved in purchasing real estate.
Foreigners can purchase various types of properties in Portugal, including residential homes, commercial properties, land, and investment properties. They can also engage in seamless property search and assess property values with the country’s straightforward process.
Also, you do not need to have permanent residence status or hold Portuguese citizenship to buy property in Portugal. You don’t even live in the country, as non-residents are allowed to own real estate, and there are no restrictions based on nationality.
Portugal’s real estate market is flourishing, offering an array of property types. Whether you’re looking to buy in Portugal or just exploring, you’ll discover an abundance of options to find your dream home in the country
From eclectic farmhouses to trendy warehouse-style apartments, beachfront condos, and luxurious villas, the property market in Portugal is exceptionally well-developed.
There are many different types of homes for sale in Portugal. However, when it comes to buying property in Portugal, you’ll encounter various terms that you might need to get accustomed to.
In the following section, we’ll provide you with clear definitions of these terms to help you navigate your property search with confidence.
When looking for a new home, you might come across ads with terms like ‘T0, T1, T2’, etc. These indicate the number of rooms in a property—a T1, for example, is a one-bedroom apartment, while T0 refers to a studio apartment. In the local market, some of the more luxurious properties in Portugal come with amenities like swimming pools, extra security, or private gyms, which can increase the price.
Portugal offers a variety of locations for buying property, and the ideal spot for you will depend on your budget and the type of property you’re after.
Start by determining what you’re looking for and which area of Portugal appeals to you. Compared to other European countries, property prices here are relatively affordable.
Each region has its unique charm and benefits. Here are some places to consider when searching for your dream property:
Lisbon, the capital and central economic hub of Portugal, is a vibrant city rich in history and increasingly popular for both tourism and business. It’s an excellent choice if you’re looking to buy property, whether for commercial use or to settle down.
However, keep in mind that property prices in Lisbon have surged recently, making it quite pricey compared to other parts of the country. While this rise in property prices may seem steep, it also means that property value is increasing, which can be a significant advantage for investors looking to benefit from long-term gains.
The most expensive areas in Lisbon include Avenida da Liberdade, Baixa, Chiado, and Lapa.
For more information, check out our guide on where to buy property in Lisbon.
The Algarve is a magnet for everyone from retirees to second homeowners and investors. It’s a top holiday spot in Portugal, famous for its sunshine, beautiful coastline, fresh seafood, excellent golf courses, and natural beauty.
With easy flights to and from the UK, it’s no wonder that many English-speaking homeowners have holiday homes, villas, and beach houses here. Owning property in the Algarve means enjoying life in one of Europe’s most picturesque regions.
To learn more about real estate in the Algarve, check out our guide on where to buy property in the Algarve.
Often called Portugal’s second city, Porto is one of the oldest centers in Europe. It’s a lively commercial hub with a deep historical and cultural heritage.
Famous for its Port wine, Porto is a sought-after tourist spot. When it comes to property, you can find great deals in districts like Ribeira, Foz do Douro, Vila Nova de Gaia, and Vila do Conde.
Recently, Cascais has become a popular choice for Europeans and non-EU nationals looking to buy property, offering a desirable alternative to Lisbon.
This appeal is partly due to its relaxed atmosphere, charming architecture, free museums, and well-kept parks. Located by the coast, it also provides access to stunning beaches and excellent amenities.
Other locations worth considering are Braga, Coimbra, Setúbal, and Guimarães.
If you’re buying for residential purposes, it can be helpful to experience life in various areas before settling on where to purchase your property.
Looking to Secure Your Dream Property in Portugal? Get in touch with our real estate division, Goldcrest Real Estate - Portugal´s buyer's agent, to kickstart your property search in Portugal.
As the first buyer’s agent in Portugal, Goldcrest has a clear understanding of the local market and has helped hundreds of people find their ideal property.
Working solely on behalf of the buyer, they secure the best price for you, saving you time and hassle.
In recent years, the Portuguese real estate market has become increasingly popular among foreign investment enthusiasts, especially among investors from abroad. This rise in foreign investment in Portugal’s property sector is largely due to properties being relatively cheaper than in other parts of Europe.
Due to demand from foreign buyers and investors, Portuguese property prices are generally on the rise, particularly in popular areas like Lisbon, Porto, and the Algarve. Prices in Lisbon have surged significantly and are much higher compared to other parts of the country. Analysts predict that property prices will continue to increase shortly.
Lisbon and the Algarve are by far the most expensive areas to buy property in Portugal. Setúbal, near Lisbon, can also be quite pricey, while in the Algarve, locations such as Lagos, Albufeira, Tavira, and Lagoa tend to have higher property prices. For luxury houses and apartments, Vale do Lobo, Quinta do Lago, and Vilamoura are among the top choices in the Algarve. For the best guidance, consult local real estate professionals to navigate these markets effectively.
For cheap homes for sale in Portugal and great bargains, you should head inland, particularly in the central region of Portugal. An added advantage is that many houses and land in these areas are quite large and spacious. The Silver Coast is also an appealing option for those looking for reasonably priced properties, with relatively cheap houses available near the beach. It’s considered by many to be a good alternative to the Algarve, offering beautiful coastlines as well. To explore these options thoroughly, consult local real estate professionals.
When you think of beautiful coastlines and beaches in Portugal, the Algarve often comes to mind first, and rightly so. However, the Silver Coast, situated between Lisbon and Porto, offers an equally stunning coastline and is sometimes overlooked. It’s roughly an hour’s drive from Lisbon, depending on your location on the Silver Coast.
This wonderful part of Portugal is an excellent alternative to the Algarve for buying a home by the beach, as property prices are generally lower. Consider places like Óbidos, Peniche, and Nazaré. For the best options and advice, consult local real estate professionals.
The sunny Algarve is one of the top places in Portugal to purchase property or own real estate, whether as an investment or for residence. The Algarve offers a wide range of property types, from sea-view apartments and villas to luxury houses and condos.
Property prices in the Algarve can vary significantly depending on the region. For instance, Vilamoura is renowned for its luxury homes, making it one of the priciest areas to buy property in the Algarve. Lagos and Albufeira are also on the higher end of the price spectrum.
If you’re seeking cheaper properties, consider areas like Monchique and Alcoutim or more rural regions for better deals. For more information, take a look at this article about how to live in the Algarve.
Lisbon property is currently a top investment choice, though prices have surged dramatically. Apartments and properties in the downtown area and neighborhoods around the city center have seen a substantial increase in value. Despite these higher prices, Lisbon continues to attract many foreign buyers and investors, whether they’re looking for a second home or a smart financial investment. The priciest areas in Lisbon include Avenida da Liberdade, Baixa, Chiado, and Lapa. For more detailed information, check out our property guide to estates in the Avenidas Novas district.
For more affordable properties at reasonable prices, consider areas like Benfica and Amadora.
Cascais and Estoril are also excellent alternatives to buying property within the Lisbon metropolitan area. Located just a 30 to 40-minute drive from Lisbon, these areas offer a charming coastal lifestyle. While real estate prices here are gradually increasing and can be high in certain spots, they still provide great value for money. Additionally, Oeiras, situated between Lisbon and Cascais, is another solid option. For further details, check out this article about buying property in the best neighborhoods in Lisbon.
The real estate market in Porto is also showing some great signs of growth, and it is generally considered a good place to buy property in Portugal. More and more people are looking for alternatives to the Algarve and Lisbon, where real estate prices are rising rapidly. In this regard, buying a property in Porto also makes for a good investment as it is both a commercial and tourist hub and has a large student population.
There are different types of property to choose from throughout the Porto district. For example, properties in the Foz do Douro neighborhood offer lovely views of the Atlantic, while Vila do Conde is an upcoming area where you can still find great bargains. The Ribeira neighborhood is also a good place to buy, especially for commercial purposes.
There are many online portals and real estate agencies that advertise properties for sale in Portugal.
Some of them are:
Real estate agents can also help you with your search. Estate agent fees are typically covered by the seller and tend to be 3 to 5 percent of the sale price, so bear in mind that they will look to get the best price possible since a higher sale price translates to a higher commission for them. This means the asking price could be inflated to reflect the agent’s commission. As a buyer, be mindful of this and factor in potential negotiation room when considering an offer.
Another way to find a property in Portugal is through a buyer’s agent. Buyer’s agents usually have access to properties for sale that are not advertised on the real estate market and sometimes can get lower prices, too.
If you’re not making a one-time payment for the property you want to buy in Portugal, then you will probably need to understand financing options to pay for the property. The most common is by securing a mortgage loan.
You can decide to get a mortgage from a bank in your home country or from Portuguese banks. Some Portuguese banks you can approach for mortgage loans are Santander, Novo Banco, and BBVA.
In most cases, non-residents can get a 25-year mortgage, while residents can get up to 30 years. Also, non-residents will have to put up a 30 percent deposit, while residents are only asked for a 20 percent down payment.
For more information about mortgage loans and financing property in Portugal, you can see our article on financing property.
Utilizing a mortgage broker in Portugal can significantly ease the home-buying journey. Many mortgage comparison websites are only available in Portuguese, making broker expertise crucial. These brokers typically work with a panel of banks, offering a wider range of options than you might find on your own. Studies show significant time savings when using a broker; in particular, this can make securing pre-approval quicker. This can be a major advantage in Portugal’s competitive housing market.
Buying a house can be difficult, whether in your home country or abroad. It can be even trickier when buying abroad with little knowledge about the process. The good news is that the process involved in buying a house in Portugal does not entail too much paperwork, and there are no restrictions on foreign ownership in Portugal.
Here’s a quick breakdown of the steps you’ll need to take to buy a property successfully:
To enter the property market and purchase property in Portugal, whether as a resident or non-resident, you will need to have a Portuguese tax (fiscal) number (número de contribuinte), also known as the tax identification number (NIF) in Portugal. You will also need a tax number to open a bank account.
If you’re a resident of Portugal, this can be obtained at any local tax office (Finanças). You must show proof of your address and passport to obtain a tax number. If you’re not a resident of Portugal or the EU, instead of going to a local tax office, you’ll need to appoint a fiscal representative to apply for an NIF on your behalf
As a buyer, you will need to provide proper identification. It can either be a passport or a Portuguese ID card (Cartão de Cidadão).
Opening a Portuguese bank account is advisable when buying a property to avoid dealing with frequent changes in the exchange rate.
After agreeing on a price with the seller, the next thing is to conclude the purchase process. To conclude the purchase of a property in Portugal, you should do the following:
In Portugal, the buyer incurs the following cost upon purchase of a property in Portugal.
Step one
Compare the different banks to find the most suitable one for your circumstances.
Step two
Get your documents ready, which include:
Step three
The bank evaluates the property and determines the Loan-to-Value.
Step four
Get life insurance. In Portugal, you must get life insurance when contracting a mortgage loan.
For more about mortgage loans and financing property in Portugal, see our article on financing property.
When buying a Portuguese property, you’ll need to be aware of your property tax obligations. In this section, we’ll explain the various property tax regulations that apply to property owners in Portugal during and after the property acquisition process.
The Imposto Municipal sobre Transmissôes Onerosas de Imóveis (IMT) is a municipal property transfer tax that you would be required to pay before you sign the sales agreement. If you’re buying a commercial property, there’s a flat IMT rate of 6 percent. For residential properties, the IMT tax ranges from 0 percent to 8 percent, depending on the value of the property you’re buying
When buying real estate, you’re also liable for Stamp Duty (Imposto do Selo). This is generally about 0.8 percent of the deed’s value, and it must be paid at the time of purchase.
The Imposto Municipal sobre Imóveis (IMI) is an annual municipal property tax. It varies depending on your property’s location and type, ranging from 0.3 percent to 0.8 percent.
Wealth Tax or Addition to the Municipal Property Tax (Adicional ao Imposto Municipal de Imóveisor, or AIMI) applies to higher-end properties in Portugal. It’s a post-purchase tax applied to any property worth €600,000 or more and owned by an individual. If your property is jointly owned — with your partner, for example — this wealth tax will only apply if the property is worth more than €1.2 million.
The wealth tax rates are as follows:
If you sell your property in Portugal, you could be liable for capital gains tax. Any profit made from the property sale will be considered capital gains.
In the tax return that you file in the year that you buy the property, you will need to include the price that you paid, invoices for renovations and other purchase details. These details will be used in the capital gains assessment. As a general rule, capital gains in Portugal are subject to a 28 percent tax rate.
If you re-invest the total selling price into buying a new home, you could be exempt from some capital gains tax. To qualify for this exemption, you must buy a new property within 24 months before the sale or 36 months after the sale. You should inform the Portuguese tax authorities that you intend to re-invest, and the capital gains tax will be suspended.
When you’ve bought a new property, the tax authorities will calculate your profit and verify that you’ve used it to buy your new home.
While Portugal doesn’t have inheritance tax in the traditional sense, a stamp duty might apply to inherited property for non-exempt beneficiaries. These non-exempt beneficiaries include anyone who is not a descendant (children, grandchildren), ascendant (parents, grandparents), or spouse of the deceased.
In conclusion, you may have questions like: Is it the right time to buy? Should I wait? What type of property should I buy? In truth, the answers to these questions are always complex, but one thing is for sure – owning a property in Portugal is a good financial investment.
Bonus tip: If you’re considering buying property to relocate, you may be wondering what to expect in terms of living in Portugal. We’ve got you covered – you can consult our Expats in Portugal guide for more information.
Buying Portugal real estate to rent is an excellent financial investment. It is worth it as there is more demand for accommodation than what is currently available — especially in Lisbon and Porto. Also, rental yields during peak tourism season make property rental in Portugal a viable investment.
This largely depends on what you want to do in Portugal, whether you are looking to live for a long term in the country or have a second home. Either way renting before buying is a popular option amongst expats who move to Portugal as this gives you the opportunity to sample different areas before making a huge commitment to purchasing a place. Some things to consider when deciding between renting or buying are:
In this regard, renting gives you more room and freedom to try out different areas of the country. You can see what suits you better as you are not committed to any place yet. It is also not a huge financial liability in case you decide to move out of Portugal as opposed to trying to sell your property if you decide to leave Portugal.
Owning a home gives you a certain sense of security which renting doesn’t necessarily offer. Although the housing laws in Portugal are generally in favor of the tenant, you are still somewhat at the mercy of the property owner as they can decide to sell the property or even choose not to accept the renewal of your lease.
If you have the financial means, buying a property worth at least €500,000 in an interior part of Portugal can make you eligible for the Portuguese Golden Visa, which allows you to work and live in Portugal as well as have free visa travel in the Schengen area.
Please note that, as of October 2023, Portuguese Golden Visa applicants can no longer buy real estate to qualify for the program.
Take a look at our Portugal Golden Visa Ultimate Guide by local experts
click here
In Portugal, renting limits the type of property you will have access to, especially if you’re looking for long-term rents in places like the Algarve. Many homeowners prefer short-term sublets during the high season because of the rental income they make during these periods.
Generally, the cost of buying a property in Portugal is relatively cheaper than in other European countries. So, it may be a good idea to purchase a property now because the prices are still low and can be sold in the future at a great profit as opposed to paying rent which in real terms is dead money.
The Portuguese economy has gradually recovered from its financial crisis and recession. Tourism is booming again, and the housing market is breaking new ground. Generally, the demand for property in Portugal in the major cities right now outweighs the supply of property. This has pushed the prices of property upwards. Also, there are constant renovations of derelict buildings and constructions of apartment buildings, as well as new hotels springing up. This has also led to the gentrification of some neighborhoods recently.
Tourism and increased demand have contributed to the increase in rent and point to a real estate bubble in Portugal, as many properties are being overvalued. The property bubble is set to be around for a while if the interest from foreign investors does not slow down, as they represent the highest number of buyers in the past few years.
Yes, US citizens can buy property in Portugal. There are no restrictions on foreign property ownership in Portugal. The Portuguese government encourages foreign ownership of property in Portugal. You will, however, need to have a Portuguese NIF number. If you would like to stay in the country for more than three months, you will need to have the appropriate residency to stay in the country.
Yes, there are no restrictions on British citizens purchasing property in Portugal. If you would like to stay in the country for more than three months, you will need to have the appropriate residency to stay in the country.
DISCLAIMER: This guide on How to Buy a Property in Portugal is not intended as a substitute for legal advice. Whilst we take care to ensure that all our information for your Portugal search for property is correct and up-to-date, it is important to always rely on professional advice or the relevant legislation when considering your particular circumstances.
While it’s no longer possible to enter the real estate property market in exchange for a Golden Visa, other investment options are available for this visa scheme.
The Portugal Golden Visa Program is an attractive five-year residency-by-investment program open to all non-EU, non-Swiss, and non-EEA nationals. Qualifying applicants must invest in the nation to obtain a Portuguese residence permit. Portuguese citizenship by naturalization is possible after five years of holding your investment.
You will also be required to adhere to all the rules under Portuguese nationality law, such as holding a clean criminal record. Once you have your permanent residency or citizenship, you’re eligible to start looking into foreign property ownership in Portugal.
If you're considering making the move to Portugal, it's essential to be informed about the various visa and residency options available. The Golden Visa Portugal program is an attractive option for many, offering residency to investors and their families. For those eyeing retirement in this beautiful country, the Retirement Visa (D7) is tailored for you. Digital nomads can take advantage of both short and long stay options with the Nomad Visa (D8). Meanwhile, the NHR - Non Habitual Tax regime provides significant tax benefits for new residents.
For the entrepreneurial spirit, Portugal offers the Entrepreneurship/startup Visa (D2) - Start-up Visa (open company) tailored for those looking to establish their businesses in the country. Those with specialized skills can explore the Work visa for highly qualified employees (D3). Additionally, if you have Portuguese ancestry, you might be eligible for Citizenship by descent.
However, moving to a new country isn't just about visas. If you're thinking of buying property, our guide on Buying Property in Portugal can offer invaluable insights. Dive deeper into the immigration process with our comprehensive Portugal immigration guide. For Americans specifically looking to relocate, we have curated information on Americans moving to Portugal. Lastly, one can't forget the importance of the NIF (Tax Registration Number), a crucial step in any relocation process.
