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• BUYING PROPERTY IN PORTUGAL

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In Portugal, all estate agents have to be licensed by the Government, whether a Portuguese national or a foreigner working as or for an estate agent over there, must be registered with the Instituto de Mercados de Obras Públicas e Particulares e do Imobiliário (Institute of Dealers in Public and Private Works and in Real Estate), the body responsible for supervising and monitoring the goings-on of estate agents. They must also have insurance so that clients can get compensation in the event of negligent conduct by the agent.

All licensed Portuguese agents are given an AMI number (Actividade de Mediação Imobilária) issued by the Government and are known locally as mediador autorizado (authorised mediator) and the vast majority are also members of the main professional estate agents.

All licensed agents are legally obliged to display the licence in their offices, and give details of it in all correspondence. Agents will not be offended if you ask to see proof of their licence when you are dealing with them by phone, fax and email as any reputable agent will want to maintain the standards of the industry. Warren International are based in the UK and all of our connections based in Portugal are licensed, so you can rest assured that your interest will be protected at all times.

All properties are fully checked before coming onto the market and most property transactions we strongly recommend having a full structural survey, an additional added expense but may save thousands.

Tax Number / Fiscal Number (Numero Fiscal de Contribuinte)

In order to purchase property in Portugal you will need a fiscal number which is obtainable from the nearest tax office (Ministerio de Finanças). You will need a proof of identity (your residency card, identity card or passport) and an address in Portugal so that the tax office can send your fiscal card (Cartão de Contribuinte). If you do not have a Portuguese address you can use that of a solicitor or a friend. When you move into your property, remember to change your details to the new address!

Bank Account

It is advisable to open a Portuguese bank account, so that any bills that arise during the buying process can be paid locally. You will need your passport, birth certificate,and some proof of address in the U.K. (such as utility bills). Transfer of large amounts of money can then be sent from your U.K account to your Portuguese one.

Promissory Contract (Promessa de Compra e Venda)

When you have chosen a property and have agreed a price, you will sign a Promissory contract (Promessa de Compra e Venda) with the owner. This states that you promise to buy the property, and the owner promises to sell it to you, at an agreed price and within an agreed timescale.

You then pay a deposit (normally 10% of the purchase price) and agree on a date to complete the purchase. If you withdraw from the purchase you will lose your deposit, and if the owner fails to keep their side of the bargain, they must repay you twice the amount of your deposit. It is highly recommended that you employ a Portuguese solicitor to handle the contract.

Purchase Tax (Imposto Municipal - IMT)

You must pay the purchase tax (IMT) before you complete the sale. Purchase tax for plots of land is 5% for ordinary land, 6.5% for building land.

IMT on other properties is on a sliding scale based on the value of the property.

Completion of Sale (Escritura Publica de Compra e Venda)

All of the parties must agree a date to complete, and make an appointment with the Notary. Everyone involved in the purchase/sale must attend at the Notary's office, (unless you have granted your solicitor power of attorney to act on your behalf). You must have a translator present so that you understand what the notary reads to you. Your solicitor must ensure that all the relevant documents are present. You and the sellers will be read the Deed of Purchase and Sale which everyone will sign. At this point you must pay the balance of the purchase price.

The property is now yours, but you must still take an official copy of the escritura to the land registry (Conservatária do Registo Predial) to have the property registered in your name.

If the property is to be your main residence you will normally be able to claim exception of the local council tax (IMI) for up to the first 6 years, depending on the value of the property:

Value of property up to 150,000 euros - 6 years exception
Value of property up to 225,000 euros - 3 years exception
(correct as of September 2006)

If you require further information, please do not hesitate to contact us on 01753 625101 or email your requirements to sales@warrenpropertymatters.co.uk.