Useful information about Portugal
Attracted by the temperate climate, friendly people and ease of travel from the UK, many British people have chosen Portugal as the location for their second home or even moved there permanently.
Since 1993, when new planning regulations were introduced, new building has generally declined, and so property prices to rise (at around 15–20 per cent per annum) but also helping to ensure that new developments blend with their surroundings.
Property prices vary but are generally higher than in Spain, owing to higher land costs and generally superior quality.
Living Costs in Portugal
Portugal is becoming more expensive to live although general goods are cheaper than in other EU countries but some luxury and imported goods are quite expensive.
Buying real estate in Portugal
Primo Properties will obtain a certificate (Escritura) from the local Land Registry confirming that the property is available to sell. This document will need to be produced to the Notary at the time of signing the contracts.
If the full purchase price is being paid immediately, a purchase contract will be drawn up by the Vendor's legal representative, covering the details of the contract, purchase price and date of completion. At the time of signing the contract, the Purchaser will pay a deposit usually about 10% of the agreed purchase price. If the purchaser should withdraw from the contract this deposit will be forfeited, whilst if the vendor should withdraw they will be obliged to forfeit double the value of the deposit.
Solicitor / Lawyer
The conveyancing (Escritura) will check that any searches and other legal requirements have been carried out, funds prepared and that both parties can agree a completion time. The transfer of title will then be prepared and will be signed by both parties or by their solicitors/lawyers, in the presence of a notary. The balance of the purchase money can then be handed over. The contract will be retained by the notary and a copy registered with Public Records. You will then have to arrange for registration with the Land Registry which ensures your proof of legal ownership and the Inland Revenue will also be notified for your property and rating taxes. Prior to buying your property you should apply for a tax number.
Fees
This will usually be a total of about 15% of the purchase price, slightly less for countryside property. The costs include Solicitor/Notary fees, Stamp Duty and Transfer Tax (SISA) when buying real estate in Portugal.
Property Tax
Property Transfer Tax (SISA), is payable when the registered owner of the property changes in Portugal and is currently under review. The rates currently are:
0% to €80,000
2% - 6.5% thereafter
5% for land
A municipal tax is levied by reference to the ratable value, from 1%. For offshore companies the rate is now 2%. From 1st January 2004 this will rise to 5%. Buying a property using real estate holding companies is a popular tax efficient method of investing in a second home. It can allow buyers to minimise property transfer taxes and avoid capital gains on sale and inheritance tax in the event of death.
Capital Gains Tax: Should your property be held through an offshore company no change of ownership will be recognised by the Portuguese authorities and any applicable rate of capital gains tax will be avoided. Otherwise Capital Gains will be a maximum of 24% on property bought since 1989.
Mortgages
You can borrow against property from a Portuguese financial institution although it can be difficult should it be for a second home by other non-Portuguese nationals. If the property is being purchased through a Gibraltar offshore company you could use a bank based there who would generally advance up to one half of the purchase price, subject to status. These mortgages can usually be arranged in most of the major currencies over terms up to a possible maximum of 20 years.
Getting to and from Faro Airport, Algarve...
Faro Airport: 53 kilometers to the Spanish border in the east with the motorway and 113 to Cape St. Vincent in the west, part motorway.
Coach: Eva is the main service and stops outside the airport, taking passengers to various destinations. A 20-minute journey will take you to Faro, the capital of the Algarve.
Taxi: Reasonably priced with fixed prices for long journeys, although these should be discussed before travel.
Road: Drivers should watch out for signs once they approach the motorway. Faro and Espanha (Spain) takes you to all points east and Lisbon, Portimão and Lagos to all points west.
Useful links
Click here for exchange rate details
Click here for UK medical advice provided by the NHS
Flights
The Portugal News: An English language newspaper, with coverage of the whole of Portugal.
Algarvenet: An excellent Algarve portal, providing a wide variety of information about the Algarve and links to local services.
Algarve Resident: News and articles from one of Portugal's English language newspapers. Available in both Algarve and Greater Lisbon editions.
AFPOP: The association for foreign residents in Portugal.
British Embassy: Website of the British embassy in Portugal. This site contains lots of useful information for those thinking of moving to Portugal.
IMOPPI: The regulator for Real Estate and other associated services in Portugal. You can check that the Real Estate agent you choose is licensed on this site.
Search Algarve: A comprehensive Algarve search engine.
Search Iberia: A Portugal and Spain search engine.
www.portugalstop.com: A Valuable Portugal information resource Website.
www.algarvestart.com: An Algarve search engine.
Faro Airport: Providing information about Faro airport. Includes on line information about flight departures, arrivals and delays.
BAA: Information regarding airports in the UK. The website has flight information, timetables and directions to airports.
www.pt.britishcouncil.org: The British Council is the United Kingdom's international organisation for educational and cultural relations.
The Property Investor: The Property Investor - Residential Property Magazine.
Expat Focus: Expat Focus - international living advice, employment overseas, buying property abroad, international insurance and expatriate mortgages Join our lively expat community today! Get help finding international insurance cover, overseas property, job opportunities abroad and investment advice, including pensions and retirement planning. Keep in touch with other expats through our forum, email discussion list and monthly newsletter.
www.obrigado.com: Directory of Portuguese web sites in English.
Portugal Weather: We provide weather reports for Portugal.
