Buying a property
Buying a property in Portugal can be a simple and straight-forward process as long as you take advantage of a reputable and highly experienced real estate agent that is:
- Locally situated and fully licensed.
- Has a good quality and in depth property portfolio
- Who can communicate fluently in your own language.
- And is specifically experienced in helping foreign buyers in your chosen area
Choosing the right real estate agent is a crucial part of buying property successfully. To avoid unnecessary problems, it is vital that you work solely with government licensed real estate agencies. Issued by IMPIC, the governmental institution regulating the building and real estate sector in Portugal, licensed agencies can be recognized via the AMI number. Compass Property Sales has the license AMI 17591.
Compass Property Sales focuses on property sales in the Central Algarve and the East Algarve. Our multilingual team, with over 40 years of combined real estate experience in the Algarvian property sector, has created an overview below of the most important steps to keep in mind when pursuing the dream of purchasing a property in the sunny Algarve.
- Making the offer
Once the buyer has found the ideal property, it is important to discuss the terms of the offer with us at Compass Property Sales before formally presenting the offer, preferably in writing.
- Legal representation
Once the price for the property has been negotiated and agreed, usually subject to a survey, Compass Property Sales will forward the “Heads of Terms” to the buyer´s lawyer and the vendor’s lawyer. The vendor´s lawyer will then forward all the property documents to the buyer´s lawyer who will perform the due diligence, checking all the property paperwork and making sure there are no debts associated with the property. Once this has been completed the Promissory Contract will be drafted.
- Promissory Contract
At the signing of the Promissory Contract, the buyer will normally pay a 10% deposit of the value of the agreed sale price to the vendor, via the lawyer´s client accounts.
The date of completion will have been agreed by both parties and will be written into in the Promissory Contract.
- The Final Deed (Escritura)
The Final Deed is the transfer of property ownership from the seller to the buyer in exchange for the remaining balance, which is signed at the notary´s office on the day stipulated in the Promissory Contract.
If the buyer or seller cannot be present at the deeds, then they can give power of attorney to their legal representative to sign on their behalf.
- Additional costs
Please note that in addition to the agreed purchase price of the property, the buyer will have to budget for the following:
- Legal representation fee – normally 1% of the agreed purchase price.
- Property taxes, stamp duty, notary fees – approximately 7% of the agreed purchase price.
- Final Steps
The buyer´s lawyer will register the new owner in the Land Registry and will usually make sure all the utility bills are changed into the new owner´s name. Following the purchase, we at Compass Property Sales will be pleased to assist you if you require any help re-decorating, furnishing or renovating the property.
Furthermore, if you are looking to rent out the property, then we can also introduce you to a number of local reputable letting agents.
If you have any additional queries or questions regarding any aspect of purchasing property in Portugal then please feel free to contact us.
