Real Estate in Portugal
Current prices of real estate in Portugal are much lower than those in the UK or elsewhere in Europe and, as such, buying property in Portugal can be a good investment for foreign buyers. However, when you are investing in Portugal’s real estate market you must have clear objectives and get good advice from a lawyer before embarking on what is, potentially, a very expensive venture.
Here is some basic advice and a few guidelines to keep in mind when buying into the Portugal real estate market:
• Know what your objectives are before you buy real estate in Portugal. Are you buying to live in, rent out or resell the property? Your motives will necessarily dictate where you buy and what sort of properties you look at.
• Seek advice from a lawyer who is experienced with foreign property transactions, preferably with experience of Portuguese property, BEFORE you launch into the buying process. If you advise your lawyer of your intentions from the beginning it will be far easier than trying to explain it in the event of something going wrong at the end. At a cost of between one and three per cent of the price of the house, it is worth the peace of mind, and you wouldn’t buy in your own country without consulting one would you?
• Location: a vital factor in Portugal real estate. If you are buying to rent out you will need to buy a property in an area that is popular with the rental market. That cheap place in the distant Alentejo will not bring in the same rental income as a place near the beach in southern Portugal.
• Get to know the area very well before buying. This means living there, if necessary, in rented accommodation whilst carrying out your search. When you live somewhere you spot all the defects where as a quick two-week trip can leave you in the dark about certain aspects.
• Do not rush into a decision: there is plenty of real estate for sale in Portugal and it is better to wait and be certain about your choice than to rue the day at your leisure later on when you realise there is a motorway planned to run over your property.
• Make sure your estate agent is licensed, bonded and insured, even foreign estate agents have to comply with Portuguese law on this one and, no matter how nice they are estate agents won’t voluntarily pay out if something goes wrong and they are not obliged to do so.
• Decide who will own the property as, making a wrong decision can lead to expensive and unnecessary taxation (your lawyer will be able to advise you).
• Secure a mortgage offer before you start looking so that you are ready to purchase as soon as you find your dream house.
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