Portugal

The cost of living in Portugal is one of the lowest in Europe and if that’s not enough to grab attention, it’s ranked sixth safest country in the world, according to the Global Peach Index 2022.

The friendly communities, connectivity, culture, favourable climate, fabulous food & wine and first-class facilities find both tourists and expats being drawn here in ever-increasing numbers. There is a slower pace of life that has appeal, although this can mean more bureaucracy.

Our affiliate partners concentrate on Central and Western Algarve. With over 300 days of sunshine a year, the Algarve is one of the sunniest regions in Europe. Its stunning scenery, sandy beaches and relaxed lifestyle take some beating.

Routes to residency for those outside the EU/ EEA include the D7 visa and the attractive Non-Habitual Resident (NHR) scheme that offers new arrivals incentives such investment or pension income tax free, or minimal tax on earnings for the first 10 years. Digital Nomad visas have gained traction amongst the younger generations.

Real estate agents have a legal requirement to be trained and certified in Portugal. Buying property can take as little as five weeks, so it’s advisable to have finances in order before looking. Like many other countries, deals become legally binding early on. Allow 8-10% on top of purchase costs for taxes & fees. A 20-30% deposit is normal.

A Personal Fiscal Number (NIF) is required to buy a property.

Mortgages are available to third country nationals, but the loan to value offered will be lower. Fees apply. Portugal has the law of Subrogation, meaning that debts are attached to the property, not a person. Sales are conducted by an appointed Notary who checks legalities, ensures compliance and tax payment. A translator and lawyer are additional costs. It is up to the buyer or their lawyer to register the property with the land registry after completion.

There is Capital Gains Tax in Portugal. Also Wealth Tax on assets above €600,000 per individual. There is no inheritance or gift tax, although there is a 10% stamp duty. Under inheritance law, at least 50% of an estate (or Portuguese assets if non-resident) has to be left to immediate relatives or spouse. Stamp duty does not apply to immediate relatives. It is possible for foreign nationals to choose succession law of their country of nationality in a will if preferred. All tax and legal matters need specialist advice.

Portugal is an attractive option for property investment, given its appeal and relatively stable economy, especially if looking to longer-term capital growth. After a low point in 2012 prices have been recovering steadily since with an average annual growth of 2.5%, but this does depend on location and area.

Fun fact, roughly 5% of the world’s Portuguese speakers live in Portugal.

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