Buying Property in Portugal | Endevio (2024)

FAQs

Buying Property in Portugal | Endevio? ›

Can You Buy Property in Portugal as a Foreigner? The short answer is YES! One of the most encouraging qualities of Portugal is that there are no restrictions for foreigners who want to buy a home in the country.

Can You Buy Property in Portugal as a Foreigner? The short answer is YES! One of the most encouraging qualities of Portugal is that there are no restrictions for foreigners who want to buy a home in the country.

Yes, buying property in Portugal is a great investment. Portugal's real estate market offers a variety of good investment opportunities, whether you want a holiday home, a retirement property, or an investment property to rent out.

Buying property in Portugal allows you to acquire a Portugal residence permit, as long as you stay in the country for a minimum of 14 days each two years. That means you can buy a property in Portugal and get residency. Moreover, you may apply for citizenship and an EU passport five years after obtaining residency.

The country has no restrictions on foreigners looking to buy a house in Portugal. You won't have to fill in any extra paperwork or meet any criteria to buy a home per say. All you need is a VAT identification number, known as a número de identificação fiscal (NIF) or número de contribuinte in Portugal.

The national average price of a 2,000-square-foot home in Portugal is $278,000. Buying a house in Portugal as an American is about 40% cheaper than the U.S. median home price, which is roughly $455,000.

In Portugal, you need to pay a property tax (Imposto Municipal Sobre Imóveis) as an owner of a property. The tax rate differs according to each different municipality. The municipal assemblies determine their own rate.

Property is taxed annually by the municipality in which it is located. Each municipality assigns a patrimonial value and assesses a rate that generally ranges from 0.5% to 1.0%. Rural properties frequently have a higher percentage of assessment but a lower value than urban properties.

Buy real estate for a price that is higher than the average one. It varies from €80,000 to €120,000, depending on the region. Prove they have income outside Portugal that is at least €500 per month for the main applicant and an additional €250 per month for their spouse.

How can a US citizen get residency in Portugal? ›

To live in Portugal, you must have a Portuguese residence permit. A residence permit can be obtained if you find work in the country, enroll in a long-term course of studies, marry a Portuguese citizen, or invest in Portugal's economy.

There's a bit of time between the Promissory Contract (deposit) and Escritura (deeds) stages, which could be anything from around two weeks to a few months, depending on the particulars of the sale.

As an American, you need to get a Portuguese residence permit if you're planning to stay there for longer than three months. If you reside in Portugal with a proper residence permit for five years, you can then apply for permanent residency or Portuguese citizenship.

You need to apply for residency in order to retire in Portugal as an American. The process is straightforward, but it may take a while. You need to provide (1) your passport, (2) proof of income, (3) proof of health insurance, (4) criminal background check, in order to apply.

Portugal is actually considered one of the most affordable countries in Western Europe and is an average of 50 percent cheaper than living in the United States.

Is property cheaper in Spain or Portugal? Property in Portugal is far cheaper than in Spain, and with attractive rental yields in Lisbon and the Algarve, you can understand why Portugal is such a popular choice for investors.

English is widely spoken in Portugal, especially in the larger cities and in the Algarve. Plenty of foreigners live comfortably and reasonably efficiently speaking only in English. (In fact, it can be difficult to find a Portuguese who will speak to you in Portuguese.)

Cheaper housing

The price of housing has risen steeply over the past quarters. Nonetheless, when comparing life in Portugal with a life in France, it is important to know that buying a house in Portugal is still quite cheaper than in France.

This agreement ensures that US expats working in Portugal will not be subject to dual Social Security taxes. Instead, expats will only have to pay into the Social Security system of their home country.

Mainly yes, Portugal has a free healthcare system. It's free for all Portuguese citizens and residents. Citizens and residents of the country who contribute to the Social Security Fund can receive free medical care through the National Health Service, SNS.

Is healthcare good in Portugal? ›

In 2022, the World Health Organization (WHO) ranked Portugal in the 12th place of world healthcare systems. With both private and public healthcare options, the country offers universal health coverage through the Servico Nacional de Saude (SNS).

Overall, Portugal's combination of warm weather, affordable cost of living, high quality of life, welcoming culture, and attractive visa and residency programs make it an ideal destination for Americans looking to live and work abroad.

How many expats are living in Portugal? In 2022, Portugal expats numbered around 661,000. That's about 6.5% of the population. Over 7,000 Americans live in Portugal currently, and that number is quickly rising.

Combined with its relatively warm temperatures, plentiful recreational activities, widespread knowledge of English among many locals, and relatively low cost of living, Portugal is a natural destination for Americans looking to relocate.

If you're moving to (or are already in) Portugal and earning an income, you may have to pay taxes. If you reside in Portugal for 183 days or more a year, you must pay income tax on your worldwide income.

This includes people who have given up their green card to live abroad. An expatriate is subject to double taxation because they are still taxed by both countries – in this case, Portugal and America – depending on where they spend most of their time during each taxable year.

How much tax will I pay? As a non-resident of Portugal you will pay tax at a rate of 28%, but only on 35% of the total rental income because the remaining 65% is deemed to be expenses in running the business. This means you are paying an effective tax rate of less than 10%.

The tax regime NHR in Portugal is granted for a period of 10 years non-renewable, as long as the individual continues to be considered as tax resident in Portugal during each of these 10 years. If for a year the person is not recognized as a tax resident in Portugal, then his status is not lost.

Non-residents are liable to income tax only on Portuguese-source income, which includes not only that portion of remuneration that can be allocated to the activity carried out in Portugal but also remuneration that is borne by a Portuguese company or permanent establishment (PE).

The percentage of tax charged can range from 1% to 8%, depending on the purchase price, the location of the property and whether it is first or second home in Portugal. The acquisition of more than 75% of the share capital of a Portuguese company that owns real estate located in Portugal, is also subject to IMT.

Does Portugal allow dual citizenship? ›

Since Portugal and the US both allow dual citizenship, you may keep both your Portuguese passport and your American one.

If you are single, you can get by comfortably with €1,200 a month in Porto or Lisbon, and even less in Portugal's smaller towns. With a higher income, you can live anywhere in Portugal with €3,000 a month, participate in various activities, go on weekend trips, and much more.

Does Portugal Allow Dual Citizenship? Portugal allows dual citizenship. Only if the applicant's home country does not allow it, the applicant may have to renounce their citizenship of their own country.

Home to approximately 87 different nationalities, Lisbon is the most popular place for expats to live in Portugal. The diversity of the city makes it a very dynamic and exciting place to live.

As a third-country national, you must apply for a visa to move to Portugal for retirement. Portugal offers two routes for you: The Retirement Visa. The retirement visa is for you who want to live in Portugal without working.

The tax rate is determined annually and varies between 0.3% and 0.8%. This tax is due by anyone who owns the property on the last day of December of the previous year. For example, if you own a property on 31 December 2021, you will have to pay the Portuguese IMI tax in 2022.

The ratings agency Moody's admits that house price correction will become a reality in Portugal in 2023 meaning price drops could be just around the corner. The global macroeconomic context has changed and the effects on the housing market in Portugal and across the world are increasingly evident.

Most mortgages in Portugal run for 25 years, but you can get terms up to 30 years. Banks vary the maximum allowed age of borrowers, which can limit the term a given institution will allow. Most banks don't offer a mortgage to individuals who are over 70. Some extend this limit to 80, however.

If you have social security credits in both the United States and Portugal, you may be eligible for benefits from one or both countries. If you meet all the basic requirements under one country's system, you will get a regular benefit from that country.

How much money do you need to retire to Portugal from the USA? ›

How much money do you need to retire in Portugal? Depending on location and lifestyle, the cost of living in Lisbon can range from $2,000–$3,500 per month. Outside of the bigger cities, you can expect to spend less.

To move to Portugal, you need to obtain a residence permit. Usually, it is issued to those who are going to work or study there, marry a Portuguese citizen or have carried out significant services for the state. Portugal issues residence permits by investment. The process takes 8—10 months.

Portugal has long been a top location to retire to. With dreamy sunsets over beautiful beaches, an affordable cost of living, excellent seafood, and attractive tax benefits, it is understandable why so many retirees are turning their attention to Portugal.

Depending on your lifestyle, a couple should be able to get by with between $2,500 (€2,332) to $3,000 (€2,798) a month in Portugal outside the major cities. In major cities, particularly in the city center, expect to need a little more.

Health Insurance in Portugal is affordable and averages somewhere between €40 and €100 per month, depending on multiple factors like age and pre-existing conditions. To visit a private Doctor in Portugal, you would typically pay around €50 to €100 per appointment. With insurance you can pay only a fraction of that.

Yes. Portuguese citizens can own firearms for hunting, target shooting, pest control and collecting. Self-defense is not considered a legal reason for owning a firearm. Legally, only licensed gun owners can lawfully acquire, possess or transfer a firearm or ammunition.

Both cultures have interesting histories, and there's always lots to see and do, but for most people, Italy is the clear winner here. There is history and culture on every corner in Italy, and most people have much more of an interest in Italian history and culture than they do Portuguese history and culture.

Portugal charges a transfer tax as well as stamp duty

On buying a Portuguese property, you are charged a transfer tax Imposto Municipal sobre Transmissôes Onerosas de Imóveis (IMT) of up to 8% plus 0.8% stamp duty (Imposto de Selo).

As an American, you need to get a Portuguese residence permit if you're planning to stay there for longer than three months. If you reside in Portugal with a proper residence permit for five years, you can then apply for permanent residency or Portuguese citizenship.

Can foreigners retire in Portugal? ›

How can I retire to Portugal from the USA? You need to apply for residency in order to retire in Portugal as an American. The process is straightforward, but it may take a while. You need to provide (1) your passport, (2) proof of income, (3) proof of health insurance, (4) criminal background check, in order to apply.

The rise in property prices has been caused by growing demand from foreign buyers, who have flocked to Portugal in search of a warm climate, lower costs of living and the so-called “golden visa” program, which ties residency permits to real estate purchases.

Existing residents

With the correct planning and structuring, you can legitimately create a tax-favourable position and in some cases, single-digit rates of tax, which means that Portugal can still be more favourable than most individual's home countries.

Property tax rates range from 0.3% to 0.45%. While properties in rural areas are taxed at 0.8%, properties in more urban areas are taxed within the mentioned range.

If you have social security credits in both the United States and Portugal, you may be eligible for benefits from one or both countries. If you meet all the basic requirements under one country's system, you will get a regular benefit from that country.

The main places American expats live in Portugal are Lisbon, Cascais, Porto, Algarve, and Coimbra. Lisbon: Lisbon is Portugal's capital city and offers a vibrant cultural scene, a bustling nightlife, and easy access to the rest of Europe.

As part of the Non-Habitual Resident (NHR) tax scheme, D7 visa holders pay just a 20% tax on Portuguese-sourced income and a 10% tax on foreign-sourced income (which would include foreign retirement and social security payments).

Portugal's living costs for retirees

You can live comfortably with an estimated €1,300-€1,500 (US$1,500-1,700) per month in small towns or €1,700 ($2,200) in larger urban areas such as Lisbon or Porto. Groceries, eating out, rent, utilities, and health care are especially affordable in Portugal.

The Algarve in Portugal is one of the best places to buy property in Europe. Sun, sea, and good rental income are just some of the reasons why investors from all over the world are favouring this coastal region.

The Algarve is one of the most popular areas in which to purchase property in Portugal. This region boasts a number of beautiful beaches and plenty of opportunities for golfing and water sports. The area is also known for its historic towns and cities, such as Lagos, Silves, and Sagres.