When the process of buying a property in Portugal for living, and spending a vacation has been a lifelong dream, it’s time to make it a reality. When you are eligible to apply for a golden visa in Portugal, the purchase of any property can even entitle you to permanent residence or the right to Portuguese citizenship, which is why the query new house for sale in Lourinha, Portugal is attracting considerable interest from investors. who wish to purchase real estate, commercial or residential, in Portugal.
Is it easy for a foreigner to purchase the desired property in Portugal?
As a foreigner, buying real estate in Portugal is very simple and intuitive. The country imposes no restrictions on foreigners trying to buy any real estate in Portugal. All you need is your VAT number, known in Portugal as número de identificación Fiscal (NIF) or número de acceptanceinte. This number can easily be obtained by anyone who has opened an account with a Portuguese bank or through the local tax office.
What is the state of the real estate market in Portugal today?
The real estate market in Portugal continues its active growth, although it has decreased slightly due to the reason of COVID. Property prices in Portugal increased by 6.32% in 2020 to an average of €1,144 per square meter. This is a significant increase, in the future a stable increase in the price of a square meter is predicted. Property price growth will also vary by region.
Should you buy any type of property in Portugal?
Buying any type of property in Portugal entitles you to a Portuguese Golden Residency Visa (citizenship after six years). Buying any type of property is a sound investment because Portugal has great potential for renting property. Portugal has a fairly low cost of living compared to other European countries and a moderately warm climate that appeals to many people who have come to love Portugal for that. Also, Portugal is a fairly safe country where you can find quality education and medical services. Most people speak English, so you don’t need to learn Portuguese (although it helps). When buying any type of property in Portugal, you should also be aware of certain disadvantages that are present. Most houses in Portugal do not have central heating. Buying a property can take longer than expected because things are done slowly and sometimes inefficiently in Portugal due to red tape.
Optimal cities for buying profitable real estate in Portugal?
Cascais is one of the most expensive areas to buy any (commercial, residential) property in Portugal. This famous municipality has 30 kilometers of coastline with some of the most spectacular beaches in the country. The center is lively all year round, with many good restaurants and shops. Cascais is a historically important hidden gem of Portugal. With its breathtaking, beautiful nature, pristine parks, and quality public schools, it’s a great place to raise a family. Cascais has a well-funded, developed urban infrastructure, as evidenced by excellent public transport that works flawlessly. The Algarve is the best vacation spot in Portugal with the best climate and the warmest sea water. With over 300 days of sunshine, the Algarve is a popular holiday destination for retirees, especially from the US and UK. The Algarve has a wide range of public and private schools, including international schools. English is widely spoken and it is one of the safest places in Portugal. From large, expensive homes to affordable homes, there are many profitable real estate investment options in the Algarve, and the process of buying real estate in Portugal should be thought out. The Lisbon real estate market is an investment destination for companies and individuals from all over the world. The market is growing exponentially. It’s not a cheap place to buy, but you can still find more affordable homes outside of the city center. Lisbon has a developed urban infrastructure with quality transport, affordable prices, and beautiful beaches and parks. It is one of the safest cities in Europe and has some of the best public schools in the country.
The solid investment city of Porto is located 280 kilometers north of Lisbon. Porto is one of the favorite cities of investors in Portugal and one of the most beautiful places to live. The city has 220 sunny days a year. Porto has been attracting foreigners for many years and has a large international investment community, because there is real estate for sale here, which is in an affordable price category, the price of real estate is only growing rapidly. The city has a low crime rate, developed transportation, and excellent urban infrastructure, including clean parks. While prices are rising rapidly in Lisbon, Porto, and the Algarve, the Alentejo remains a choice for investors for whom property value comes first. The Alentejo has beautiful coastlines and quiet, peaceful areas where comfortable living is the norm. The city of Braga is one of the cheapest places to buy investment property in Portugal. Here, a house in the city center costs 1,481 euros per square meter. This is a big difference compared to Lisbon, where a house costs €4,623 per square meter. The most expensive is Cascais on the Portuguese Riviera, where a house costs 5,395 euros per square meter. The price per square meter of a house in the center of Porto is 2,709 euros.
Does buying a house in Portugal give me the right to stay in the country?
It depends on your economic situation, citizenship, length of stay in the country, and other requirements. However, if you want to buy a house in Portugal to obtain a residence permit, the Portuguese Golden Visa is the best choice for you. The Portuguese Golden Visa allows citizens of non-EU countries to obtain a valid residence permit (possibility of obtaining Portuguese citizenship in the future) if they invest, for example, buying a house or buying shares in Portuguese companies. The Portuguese Golden Visa was created in 2012 to actively increase foreign investment and is considered one of the most attractive visas in the world. A Portuguese Golden Visa allows you to live in Portugal and travel easily to most European countries. However, you do not need to live in Portugal to enjoy the key benefits of this visa. It is enough to stay in the country for at least 7 days in the first year and 14 days in the following year.
How much is real estate in Portugal in 2023
The minimum financial costs for the purchase of real estate in sparsely populated areas of Portugal are 400,000 euros, and in densely populated areas – 500,000 euros. You can also buy a property over 30 years old in an urban regeneration area and renovate it for at least €350,000. You don’t have to buy one property, you can buy several properties for investment purposes. Pay attention to the minimum amount. You can combine your investments with other Golden Visa applicants. For example, if you and your friend bought a house for €1 million, you can apply for a Portuguese Golden Visa because you both spent at least €500,000. If you decide not to rent out the purchased property, you do not pay any taxes. However, in this case, income from the property is taxed at a flat rate of 28%. The most common places to buy property are Porto and Lisbon, but there are also good investment destinations such as Braga, where you can buy property at an attractive price. Also, remember that you cannot get a mortgage loan from a Portuguese bank to invest in real estate if you want to apply for a Portuguese Golden Visa.
Key current benefits of obtaining a Portuguese Golden Visa
Visa-free: the Portuguese golden visa allows entry to Portugal and the Schengen area (26 EU countries). You can travel freely without a visa and enjoy the privileges of EU citizens. You have the legal right to stay in Portugal: this visa gives you the right to live, study and work in Portugal like other EU citizens. Family Reunification: This program includes family reunification. This means that spouses, minors, children over 18, children under 18 who are in school, and parents who are financially dependent on the investor have the same rights. Everyone can live and work in Portugal, travel freely within the Schengen area, and enjoy all visa key benefits. Permanent residency: Investors can apply for permanent residency after meeting several applicable conditions and completing the required five-year period. Citizenship: after at least six years of legal residence in Portugal, the investor can apply for Portuguese citizenship, with the possibility of obtaining a passport. Current tax benefits: When you are not a tax resident, i.e. if you are not in Portugal for at least 183 days a year, you have no current tax liability. The Portuguese Golden Visa allows you to transfer your tax residency to Portugal under the Non-Resident Tax Regime (NHR). Some of the key benefits of this tax system include a flat 10% superannuation tax that is only taxed on worldwide income after the first 10 years of residence.
Mortgage in Portugal: how to get a mortgage in Portugal to buy real estate as a foreigner?
Being a foreigner is generally not essential for buying any property in Portugal, but it is important to have a basic understanding of obtaining a mortgage. When you are a non-resident, this will affect the amount you can borrow. Non-residents can only borrow up to 65-75% of the home’s value or sales price (whichever is lower), while residents can borrow up to 90% of the property’s value. Most banks also don’t allow existing and new mortgages to exceed 35% of your monthly income. Portuguese banks usually offer mortgages for 25 years, sometimes even 30 years. The average mortgage interest rate in Portugal is currently less than 1%, which is very low. In 2013, mortgage interest rates exceeded 3%.
Current property taxes in Portugal
In addition to administrative and legal financial costs, property owners must pay certain property taxes to the state. You have to calculate each of them, which the property tax calculator in Portugal can help you with. Owners must pay three types of taxes: Local property tax IMI – Imposto Municipal Sobre Imóveis, a tax that depends on the municipality. These funds are used to maintain the city’s public infrastructure. IMI rates are typically between 0.3% and 0.45%. To calculate the IMI, multiply the value of your tax credit by the IMI rate. IMI must be paid annually. For example, if you own a property worth €500,000 and live in Cascais, where the interest rate is 0.34%, your annual IMI is €1,700. You are exempt from IMI if your family’s total taxable income does not exceed €15,295 per year. Property tax – is paid when buying a house in Portugal, so it is a one-time payment for the purchase of a house. The tax rate depends on the type and value of the property and whether it is a primary or secondary residence. The tax must be paid before buying a house. When you buy a house in mainland Portugal and its value does not exceed €92,407, you do not have to pay this tax, which is usually between 2% and 8% depending on the situation. However, assets purchased from blacklisted companies pay a 10% tax. Stamp duty you must pay when buying real estate in Portugal. The rate depends on the type of real estate and the area, but usually, stamp duty is between 0.4% and 0.8%.