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Portuguese property law

A brief summary on how conveyance is carried out here in Portugal.

To purchase a property in Portugal usually involves 4 main legal steps. This is mainly due to the fact that, for many years now, we have a public office in each council/country – a property registrar – where a record is kept of all properties. All properties within a council area are numbered, registered and described, and their "life" recorded.

Although the existence of this Office increases the bureaucracy involved in conveyance, it will also limit the time necessary to perform searches and understand exactly what is the property’s current status (court injunctions, mortgages, rights of way, etc. must be registered in order to be fully valid against third parties).

In light of this fact, before we sign the Promissory Contract, we must, carefully check the Land Registry Certificate, compare it with the Tax Certificate and the Habitation License, in order to know if we can safely proceed, and after the Conveyance Deed, immediately after its signing, apply at the referred Office for the records to be updated, reflecting the change in ownership, since here in Portugal ownership is not established by the possession of a document (Title Deed), but precisely by updating the records reflecting the ownership change.

The Basics

• To purchase a property in Portugal usually, involves 4 steps: Reservation agreement, Promissory Contract, Deed, Registration.
• The time lapse between initiating the negotiation and signing of the deeds can vary between few days and a couple of months.
• Purchase costs vary in between 5% and 8,5%, depending on the purchase price.
• Taxation in Portugal has suffered significant changes recently, with reduction of rates for active professionals residing in Portugal and no taxation for retired people, plus IHT (Inheritance Tax) benefits.
• If You rent out Your property, You need to apply to the Local Town Hall for a License.

For more information contact the Lawyer Paula Meireles:

• Telephone: 00 351 282 350 010
• Fax: 00 351 282 350 019
• E-mail: paulameireles@carvoeiroadvogados.com