Selling Your Property in Portugal: A Comprehensive Guide

Are you considering selling your property in Portugal?

Portugal’s property market has been thriving in recent years, attracting both domestic and international buyers. With its stunning coastlines, vibrant cities, and warm climate, it’s no wonder that so many people are interested in moving here or owning a second home here. As a seller, this means you have a great opportunity to capitalise on the demand and get the best value for your property.

In the following sections, we’ll cover everything you need to know about selling your property in Portugal. From understanding the legal requirements and taxation to preparing your property for sale and marketing it effectively, we’ll provide you with practical tips and insights to ensure a smooth and profitable transaction.

So, whether you’re a seasoned property owner or a first-time seller, sit back, relax, and let us guide you through the process of selling your home in Portugal.

How much is my home worth?

Before putting your property on the market, it’s crucial to have a clear understanding of its value. This will help you set a realistic asking price and manage your expectations throughout the selling process.

One common approach is to look at similar properties in the area, known as “comparables” or “comps.” By researching recently sold properties with similar features, such as size, location, and condition, you can get a rough estimate of your home’s value.

However, in Portugal, this method can be a bit trickier.

• Unlike some other countries, Portugal doesn’t have a central database that publicly discloses the final selling prices of properties. This lack of transparency can make it challenging to determine the true market value of your home based on comparables alone.
• Moreover, pricing in Portugal can be quite unusual. It’s not uncommon for a property to be listed at €400,000 one month, €500,000 the next, and then back to €400,000 again. Estate agents often play around with prices, sometimes with little rhyme or reason. This inconsistency can further complicate the process of determining your home’s value.

So, what’s the best way to get an accurate valuation? The most reliable approach is to have estate agents come and value your property in person. Most agents offer this service for free, and there’s usually no obligation for you to work with them afterward.

When inviting agents to value your property, it’s a good idea to get opinions from multiple professionals. This will give you a range of valuations and help you identify any outliers. Keep in mind that agents may have different methods of assessing value, so it’s essential to ask them about their process and the factors they consider.

Once you have a few valuations, you can compare them and use your judgment to determine a fair asking price for your property. Remember, setting the right price from the start can make a significant difference in attracting potential buyers and achieving a timely sale.

Should you use an agent or do it yourself?

When it comes to selling your property in Portugal, one of the first decisions you’ll need to make is whether to work with an estate agent or handle the process on your own. This is a very personal choice, and there are pros and cons to both approaches.

The main advantage of selling your property yourself is that you can save on estate agent commissions. In Portugal, these commissions typically amount to around 5% of the sale price. There are some expat-focused agencies that charge a few percentage points more, but this is the average rate you can expect to pay. By selling on your own, you can potentially keep this money in your pocket.

However, the downside of going solo is that most people aren’t equipped to sell a property themselves. Estate agents may charge steep commissions, but they’re also skilled professionals who excel at their job, particularly when it comes to closing a sale.

Selling a property involves much more than simply listing it on Idealista, even if you have great photos and well-written copy (which many people struggle with). It also requires the ability to effectively negotiate with potential buyers and seal the deal.

Moreover, if you’ve already left Portugal, working with an estate agent can be a huge advantage. They can handle all the appointments and showings on your behalf, without you needing to be physically present in the country. This can save you time, money, and a lot of hassle.

Ultimately, the decision to work with an estate agent or sell on your own comes down to your personal preferences, skills, and circumstances. If you have the time, expertise, and confidence to handle the sale yourself, you could potentially save on commissions. However, if you value the convenience, experience, and marketing capabilities that an estate agent brings to the table, it may be worth the investment.

Before making a decision, it’s a good idea to weigh the pros and cons carefully and consider your individual situation. You may even want to interview a few estate agents to get a sense of their approach and whether they’d be a good fit for your needs.

Exclusive or Non-Exclusive?

When working with a real estate agent to sell your property in Portugal, you’ll need to decide whether to grant them exclusive rights or work with multiple agents simultaneously. An exclusive agreement means that you’ll be working solely with one agent for a specified period, typically 3-6 months. During this time, you won’t be able to list your property with other agents.

The advantage of an exclusive agreement is that your chosen agent will be highly motivated to sell your property, as they know they’ll receive the commission upon a successful sale. They may also invest more time and resources into marketing your property, and may be willing to reduce their commission slightly as well.

On the other hand, a non-exclusive agreement allows you to work with multiple agents at once, potentially exposing your property to a wider pool of buyers. However, agents may be less incentivised to prioritise your property, as they face competition and the risk of not receiving a commission.

Ultimately, the decision between an exclusive or non-exclusive agreement depends on your preferences and the level of service you expect from your agent. It’s worth discussing the options with potential agents and evaluating their track record and marketing strategies before making a decision.

Necessary Documents to Sell Property in Portugal

Before putting your house on the market, whether you choose to work with a real estate agency or sell it independently, it’s crucial to gather all the necessary documents.

Having these documents in order will streamline the selling process and ensure that you’re prepared for any legal requirements.

Here’s a list of the documents you’ll need:

• ID: You can use your passport or Portuguese ID card (Cartão de Cidadão) as proof of identification.
• Permanent Land Registry Certificate (Certidão Permanente do Registo Predial): This document proves that you are the legal owner of the property and provides information about any registered encumbrances or charges on the property.
• Caderneta Predial: This is a unique certificate for each property that serves as an identification document. It contains information about the property’s location, size, and tax registration details.
• Utilisation Permit (Licença de Utilização): This document certifies that the property complies with the approved building plans and is suitable for habitation.
• Plans of the Property: These include the architectural plans, floor plans, and any other relevant drawings or diagrams of the property.
• Energy Certificate (Certificado Energético): This document provides information about the property’s energy efficiency and is required for all properties being sold or rented in Portugal.
• Technical File of the Dwelling (Ficha Técnica da Habitação): This file contains technical information about the property, such as the materials used in construction, the utility connections, and any major repairs or renovations.
• Condominium Declaration (Declaração de Condomínio): If your property is part of a condominium, you’ll need to provide a declaration from the condominium management that includes information about the condominium fees and any outstanding debts or issues.
• Mortgage Documents: If there is an outstanding mortgage on the property, you’ll need to provide the relevant documents, such as the mortgage contract and any statements or correspondence from the lender.

It’s a good idea to start gathering these documents well in advance of putting your property on the market. Some of them, like the land registry certificate and the utilisation permit, may take some time to obtain if you don’t have them readily available.

If you’re working with a real estate agency, they can often assist you in obtaining some of these documents or provide guidance on where to get them. However, it’s ultimately your responsibility as the seller to ensure that all the necessary paperwork is in order.

Having a complete set of documents will not only make the selling process smoother but also demonstrate to potential buyers that you are a serious and organised seller. This can help instil confidence and facilitate a successful transaction.

Preparing Your Property for Sale

To attract potential buyers, presenting your property in the best possible light is essential. Here are some key steps to take:

1. Clean and declutter: Ensure the interior of your property is clean, tidy, and free of personal clutter. This will help potential buyers envision themselves living in the space.
2. Make necessary repairs or renovations: Address any outstanding maintenance issues or consider making strategic renovations to improve the property’s appeal and value.
3. Stage the property: Consider professionally staging your property to showcase its full potential. This can involve rearranging furniture, adding decorative elements, and creating inviting spaces.
4. Enhance curb appeal: Don’t forget about the exterior of your property. Ensure the landscaping is well-maintained, the entrance is welcoming, and any outdoor areas are tidy and inviting.

By taking these steps, you’ll create a positive first impression and increase the likelihood of attracting interested buyers.

The Sales Process

You’ve found a buyer for your property—either through an agent or by yourself—congrats! What happens next?

The buyer initiates the purchase by signing a Promissory Contract of Purchase and Sale (Contrato Promessa de Compra e Venda), which is drafted by the buyer’s lawyer.

• The contract contains all the conditions of the transaction and sets a time limit for the signature of the final deed.
• The contract is signed by both parties or their legal representatives.
• A deposit, typically 10% of the purchase price or as otherwise agreed, is paid at this point.
• This legally binding document proves that the purchase has been contracted and sealed in accordance with Portuguese legislation.
  • If the buyer defaults on the contract, they forfeit the deposit.
  • If the vendor defaults, they must return double the deposit amount.

The completion of the purchase takes place in the presence of a notary, the registry office, or a lawyer registered with “Casa Pronta on-line.”Before the final deed of purchase and sale is read out to the parties or their representatives, several checks are conducted:

• Verifying that the IMT (property transfer tax) has been paid.
• Ensuring the content of the final deed is accurate.

Once the deed is signed, the remaining balance of the transaction price is paid.The original document remains at the location where the transaction was completed and is bound into the official records.

• Authenticated copies can be obtained at any time as proof of ownership.

A copy of the title deed is promptly submitted to the local Land Registry office and Tax office to register the change of ownership.