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The purchase procedure for property in Portugal is relatively straightforward, although the Portuguese legal system in general can be somewhat problematic so it is essential that you can appoint a good lawyer that you can converse with in your native language to avoid unnecessary problems.

Once you have located a property that you wish to purchase and have made a verbal agreement to purchase the property, you should appoint your lawyer and request that they begin checking the title deeds and that they contact the Land Registry to ensure that the correct ownership, description and any fees have been noted as correct (the finance department will be able to determine the tax liabilities). The city council should also be consulted with a view to confirming planning permission and whether there are additional developments due to begin nearby. If the property is a resale it is highly recommended that you seek a survey prior to purchase.

It will be necessary to obtain a fiscal number and then you will sign a preliminary contract (Contrato Promessa de Compra e Venda) with the seller, which will detail the terms of the sale and secure the deal. You will usually be expected to pay a 10% deposit when the decision is made as to the name in which the property is to be purchased. If you break the contract, you will lose the 10% deposit in full, if the seller breaks the contact they must pay you back the deposit in double. When the terms of the Contrato Promessa have been fulfilled it is possible to complete on the purchase with the final deed (Escritura Publica de Compra e Venda). The documentation would need to be submitted to the notary with proof of payment of the stamp duty and when the Escritura Publica has been signed in the presence of the notary, the purchase will be officially sealed.

As always when buying property you should budget for applicable fees and this is no different in the Portuguese market. You should expect to pay on average 2% of the overall property price for legal advice (not inclusive of IVA taxation). Fees for the notary and land registry should be approximately 2% with IMT tax at approximately 6.5%. You should also take into account an annual 0.2-0.8% fee of the price of your property for council tax charges.

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