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Property purchase costs in Portugal

Property purchase costs in Portugal The total cost of buying a property in Portugal includes the purchase price and the closing costs, which average 6-10 percent of this price. So how does it add up?

Fees

Notary, admin and registration fees are 1.5-2.5% of the purchase price, and legal fees 1-2% of the purchase price. The seller pays the estate agency fees.

Property tax in Portugal

It is important you know of the various property taxes, which may fall due on purchase, or throughout the period of ownership of a property.

On purchase, the buyer is potentially liable to:

  1. Imposto Municipal sobre Transmissôes Onerosas de Imóveis (IMT) is a transfer tax payable when buying Portuguese property. Ranging from 1% to 8%, rates depend on the purchase price, the property’s ultimate use and whether it is to be the main or second home.
  2. Imposto de Selo, an additional stamp duty, of 0.8% is payable on purchase.
  3. New-builds will attract 23% VAT (with no IMT), inclusive in the property price.

FAQs: Property purchase costs in Portugal

How much does it cost to buy a house in Portugal?

In addition to the purchase price, buyers should budget around 7%–10% of the property’s value for taxes, legal fees, and registration costs. This includes property transfer tax (IMT), stamp duty, notary fees, and lawyer fees.

What is IMT in Portugal?

IMT is the property transfer tax paid when buying real estate in Portugal. The rate depends on the purchase price, property type, and whether it will be your primary or secondary residence. Rates range from 1% to 8%, with higher-value properties taxed at higher bands.

Do you pay stamp duty when buying property in Portugal?

Yes. Stamp duty (Imposto de Selo) is 0.8% of the purchase price and is payable at the time of signing the final deed.

What are notary and land registry fees in Portugal?

Notary and registration fees are typically between 0.2% and 1% of the purchase price. These cover the formalisation of the deed (Escritura) and updating the Land Registry to reflect the new ownership.

How much are legal fees when buying in Portugal?

Legal fees usually range from 1% to 2% of the purchase price, or a fixed fee agreed in advance. Hiring an independent lawyer is highly recommended to protect your interests.

Do buyers pay estate agent fees in Portugal?

No. Estate agent fees, usually 5%–7% of the property’s value, are paid by the seller. However, these fees may be reflected in the advertised property price.

Are there extra costs for new-build properties in Portugal?

Yes. VAT at 23% is charged on some new-build properties instead of IMT. Buyers should confirm with their lawyer whether VAT or IMT applies.

How should I budget for additional costs when buying in Portugal?

It is wise to set aside 10% of the purchase price to cover all fees and taxes. If you are transferring funds from abroad, remember that exchange rates can affect the final amount you pay. Money can be transferred to Portugal using international bank transfers or specialist foreign exchange providers — get in touch with A Place in the Sun Currency today to see how we can help.

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