Changes in rental demand
Today the employers offer more job opportunities than demanded by applicants in Portugal. Lots of people come to work under a fixed-term contract just for a couple of years, it makes no sense to buy a property. Renting is not a problem taking into consideration the average salary level in the country. However, everything changes when we’re talking about a proper holiday home or retirement.
At the beginning of 2021 there is a steady increase in property prices for rent and sale, as a result buying a property seems more profitable than just renting it in a long-term prospectus. There is an opportunity to get a residence permit for the buyer and his or her entire family.
Since the Real Estate market does not depend on inflation and does not fall under the recalculations or falling currency, it is always under the investors' scrutiny.
Real Estate Market features in Portugal
Prices are in constant growth dynamics. An increase of 7.92% has been taking place since 2019. Analysts foretell such growth continues to the end of 2021. The residence allows free traveling within the EU. The Golden visa investor and his family can apply for Portugal citizenship in five years.
Minding the fact that in addition to investors, there are a lot of tourists, startupers, freelancers, and other people who are looking for comfortable living conditions coming to Portugal, the number of leaseholders is constantly growing.
If we talk about the costs of Real Estate investments, they are under the article of "Imposto Municipal Sobre Transmissões, IMT". In accordance with the value, location, type, and purpose of a property, it is reviewed annually. If you decide to buy property on your own to get the residence, the first step is to consider and apply for a Portugal Golden Visa program. It is important to check a property developer or a Real Estate agency before you decide to invest in their projects.
The expenses associated with buying property in Portugal
The expenses associated with purchasing a property in Portugal are divided into two types: the costs related to the property purchase itself and the expenses for the visa application process. We recommend you to have an extended budget of 10% of the property price although it is often less than this. When you reserve a property in Portugal you are given an exact breakdown of the costs involved so you are able to plan ahead.
Transfer tax - €28,040.68;
Stamp Duty tax (0,8%) - €5,000.00;
Notary and registry fees - €4.000,00;
Other legal fees - €5,000.00
TOTAL expenses: €42,040.68
How to recognise a really trusted developer from the others?
Firstly, official Ministry of Construction and Real Estate registration and Individual License number. You can find these on the Ministry’s official website.
Then, Certificate of insurance. Otherwise, in case of force majeure, there will be no one to cover your expenses. The insurance price is about 1-1.5% of the property value but it significantly cuts your costs in unforeseen circumstances.
However, if you do not plan to become a lawyer and delve into jurisprudence, contact us to clarify all the issues and to receive our professional consultation.