Buying a property in Portugal: What foreign buyers need to know

Written by Sílvia Biscaia

Portugal continues to attract international buyers looking for investment, lifestyle, or a base in Europe. From golden beaches to historic cities, the country offers more than charm — it offers opportunity (ies). But before committing to any purchase, understanding the legal process and safeguards is essential.

Whether you’re buying a holiday home, relocating permanently or diversifying your portfolio, here’s what you need to know to buy property in Portugal safely and strategically.

Can foreigners buy property in Portugal?

Yes. There are no legal restrictions on foreign ownership of real estate in Portugal. Both EU and non-EU nationals may purchase, own and sell property freely.

However, certain legal steps must be followed to ensure proper title, compliance and protection of your investment.

Documents and Tax Number (NIF)

Before signing any contract or opening a bank account, you will need to obtain a Portuguese tax number (NIF).

Your legal representative should also confirm:

  • Property registration in the Land Registry
  • Tax status and zoning in the Tax Registry
  • Absence of debts or encumbrances
  • Validity of any local or touristic licenses

The Promissory Contract (CPCV)

The promissory contract is the preliminary agreement between buyer and seller. It includes the key conditions of the transaction, namely:

  • Price and payment schedule
  • Deadline for the final deed
  • Conditions for withdrawal
  • Penalties for breach

Typically, the buyer pays a deposit of 10% to 30% at this stage.

 If the seller breaches the contract, the buyer may recover double the deposit. If the buyer breaches, the deposit is usually forfeited.

The Final Deed and Ownership Transfer

  • The final deed is executed before a notary or official registrar. At this point:
  • Full payment is made
  • Ownership is transferred

After the deed, the buyer is registered as legal owner in Land Register Office.

Taxes and Costs

When buying property in Portugal, you should budget for:

IMT (Property Transfer Tax): up to 7.5%

Stamp Duty: 0.8%

Notary and Registry Fees

Annual Property Tax (IMI): 0.3%–0.8%

Can foreigners get a loan?

Yes. Many Portuguese banks offer loans to non-residents — usually up to 70–80% of the property value.

To get a loan, you’ll need:

  • Proof of income
  • Credit checks
  • Life and property insurance
  • Legal assistance with terms

Common Mistakes to Avoid

  • Paying a deposit before legal checks are complete
  • Assuming tourist rentals are always allowed
  • Believing verbal agreements are enforceable
  • Overlooking inheritance and succession issues
  • Relying only on the seller’s agent

Legal Support Makes the Difference

Buying property in Portugal is not just a transaction — it’s a legal binding commitment. So, having a lawyer who speaks your language, understands local laws and acts only in your interest it´s essential.

At BVA – Advogados, we help foreign clients dealing with legal transactions procedures, namely:

  • Due diligence
  • Contract negotiation
  • Tax and inheritance planning
  • Real estate licensing and regulation