Overseas real estate investors are not subject to any restriction on property ownership in Portugal.
The property purchase process is quite straightforward in Portugal. If the paperwork is in order, the transaction just takes a few weeks. After having found a suitable real estate property, it is advisable that the buyer hires a professional lawyer who can handle the entire transaction.
· The lawyer has the task of checking the property titles in the Conservatoria de Registro Predial – the Land Registry – and in the Repartição de Finanças – the Inland Revenue – in order to be sure that there is not any unpaid charge.
· The buyer must obtain a Numero de Contribuinte – a fiscal number – from the Finanças – the local tax office.
· When the buyer is ready to purchase the property for sale in Portugal, a legally-binding Contrato de Promessa de Compra e Venda must be signed in front of a Notary. It is a promissory contract containing all the details and the conditions for the sale. It also establishes the date by which the balance of the purchase price must be paid.
· After the promissory contract has been signed and notarized, a deposit must be paid. It amounts to 10-30% of the final purchase price. If the buyer withdraws from the purchase, he/she forfeits his deposit. If the seller drops out, he/she must repay twice the deposit.
· Depending on the value of the property purchased, the buyer must pay the Imposto Municipal sobre Trasmissões (IMT) – a municipal property tax.
· The final step is the signing and registration of the Escritura de Compra e Venda – the final Deed of Purchase and Sale – that takes place in front of the Notary public. The final payment must be made after the signing of this final contract.
· The property is next registered in the new owner’s name in the Conservatória do Registo Predial – the Land Registry – and the trasfer is complete.
Foreign buyers can sign a document – the Procuração Publica – to give their Power of Attorney to a third person who can act on their behalf during the transaction. This document can be signed in a Portuguese Consulate in a foreign country.
In accordance with Portuguese law, overseas buyers must be assisted by a translator during the signing of the purchase deed. Before the signing, the contract must be translated verbally to the purchaser in order to be sure that he/she understands everything he/she is signing.
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