In today’s increasingly globalised world, more and more people are looking to invest in property outside their home country. Portugal is one of the most beautiful and picturesque countries in Europe, with its stunning coastal towns and pristine rural landscapes. It’s no wonder Portugal is an excellent option for those seeking an affordable yet beautiful place to buy a vacation home or retirement property.
In this post, we’ll take a closer look at why buying property in Portugal is such a popular option for property buyers. Additionally, we’ll provide details on the process of acquiring property in Portugal.
Therefore, if you're thinking about buying real estate in Portugal, read on for more information.
Why Buy Property in Portugal?
There are many reasons why buying property in Portugal is a wise investment. Mainly, the country offers an excellent quality of life, stunning scenery, and a relaxed lifestyle.
Lisbon, the capital of Portugal, is one of the oldest cities in Western Europe. The city is famous for its scenic location, rich culture, and history. Lisbon is also a significant financial centre, with many banks and businesses in the city.
Moreover, Portugal is a country with a long coastline, so there are many coastal towns to explore. Each town has its unique character; visitors can find everything from quaint fishing villages to bustling resort towns.
The Algarve region, in particular, is renowned for its sandy beaches, clear waters, and Mediterranean atmosphere.
In addition to the coastal towns, Portugal has several inland towns and cities worth visiting. The interior regions are especially varied, ranging from the mountainous north to the rolling plains of the south.
Can Foreigners Buy Property in Portugal?
Portugal’s real estate market has seen significant growth in recent years as more people are looking to purchase property in this sunny European nation.
So, can foreigners buy property in Portugal? The answer is YES! The country has no restrictions on foreigners buying properties.
Popular Locations to Buy Property in Portugal
Some of the most popular locations for foreigners to buy property in Portugal are Lisbon and Porto. Notably, house prices in Portugal rose by 4.6% in 2017, 6.1% in 2018, 8.3% in 2019, and 13.8% in 2021.
The following is a list of some of the popular locations in Portugal for real estate investment or purchase.
- Lisbon
- Porto
- Algarve
- Madeira
- The Azores
To promote investment in low-density interior regions, investors are advised to buy properties outside popular areas, such as the Algarve, Setubal and Silver Coast.
Buying a property in Portugal’s low-density areas has its benefits. Fundamentally, properties in these areas are affordable, providing you with an option to purchase multiple properties and maximise returns.
Moreover, cities in the interiors of the country are popular with students, and as the population grows, so does the opportunity to serve the growing needs of these cities.
Basically, most low-density areas are located in Portugal’s interior regions, except for the coastal areas south of the River Lima and North of the River Sado. Madeira and Azores are also excluded. The most popular low-density regions include:
- Peneda-Gerês
- Douro Valley
- Alentejo
Property Prices in Portugal
Property prices vary widely depending on the location, property type, and other factors. Generally, prices in Portugal’s major cities like Lisbon are higher than in other areas. But you can still find good deals in smaller towns and villages.
Below is an overview of the average price per m2 of residential properties in major areas of Portugal.
| Location | Average Price per m2 (As of June 2024) |
| Alentejo | €1,538/m2 |
| Algarve | €3,373/m2 |
| Lisbon Metropolitan Area | €3,721/m2 |
| Centro Region | €1,449/m2 |
| North Region | €2,233/m2 |
| Autonomous Region of Madeira | €3,093/m2 |
| Autonomous Region of the Azores | €1,535/m2 |
For more information, view the source.
How to Buy Property in Portugal: Step-by-Step Guide
Completion of accounts, contracts, and payments is required before investing. Here is the step-by-step process of buying a property in Portugal:
- Open a local bank account and obtain a Personal Fiscal Number from the local tax office.
- Browse online property portals to shortlist desired property or use a local estate agent.
- Engage with an independent solicitor to check contracts and ensure the property is surveyed.
- Sign the Contrato de Promessa de Compra e Venda (Sale Contract) after agreeing on the sale price and physical check.
- Make a down payment or deposit.
- Pay for the property transfer tax or Imposto Municipal sobre a Transmissão Onerosa de Imóveis (IMT).
- Sign the Escritura Publica de Compra e Venda (Deed of Purchase and Sale).
- Get the property registered in your name.
Beyond the IMT, property buyers also have to pay stamp duty at a flat rate of 0.8% of the home’s value. The notary and land registry fees could amount to around 0.2% to 1.2% of the property cost.
Buying Property in Portugal: No Longer a Pathway to the Golden Visa in 2024
Due to the changes made to the Portugal Golden Visa programme, purchasing real estate in the country no longer offers a pathway to citizenship and/or residency. Previously, the Portugal Golden Visa programme permitted real estate investments as qualifies for residency. However, current updates to the programme are primarily focused on redirecting investments towards other areas of social and economic development.
Read more about the changes to the Portugal Golden Visa Programme in this article.
