Pitfalls buying Property in Portugal

Avoid any troubles, buying a property in Portugal pitfalls can be easily circumvented by requesting support from local experts.

buying property in Portugal pitfalls

If you are interested in buying a property in Portugal, you should be aware of a few potential issues, which we detail below.

First, you must find out if the owners of the property are the real owners and that the property has no debts or else you could find yourself responsible for repayment debts. These checks must be carried out both before signing a promissory contract (contrato de promessa de compra e venda) and before signing the deed of sale (escritura).

Particular care must be taken when considering the clauses in such contracts – they may be described as ‘standard’ but contain clauses that are anything but! The best policy is not to sign anything that your lawyer has not reviewed first.

Illegal deals as pitfalls buying Property in Portugal

Another issue that can frequently arise is for the vendor to suggest that you pay part of the price ‘under the table’ – thus lowering the price declared to the tax authorities and reducing the vendor’s capital gains tax liability. While you would also benefit from saving money on taxes and fees, don’t forget that you will have a higher capital gains tax bill when you later sell the property. Bear in mind that if you’re selling a property and the buyer refuses to make the ‘illicit’ payment after the contract has been signed, you will have no legal redress! This practice is of course strictly illegal!

Other errors that buyers typically make in Portugal is to buy in the wrong area instead of renting first. Unless you know the area well, it would be advised to take your time to look around and know the territory. Portugal is a small country and it doesn’t take too much time to go up and down, and the roads are good, so you have a chance to find the best place for you to live.

Be careful also when buying a property for renovation as there is always a danger of grossly underestimating the restoration costs.

If you want to build a house on land you have bought it is always better to request the appropriate planning permission information from the local council – to make sure you are allowed to do what you want to – before you buy. Otherwise you might end-up very disappointed if the permission is denied and you are forced to change your plans drastically.

Take your time and be cautious: beware the aforementioned pitfalls buying property in Portugal and don t let the seller or the real estate agent pressure you into a quick purchase that you might regret later!

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  • Sean Miller, Aveiro
    Sean Miller, Aveiro
    Jul 07, 2021

    Teresa went above and beyond to ensure she attended to everything everything I needed, and explained every step of the process to me clearly and patiently.


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