Reasons For Buying and Investing In Portugal Property

-Excellent tax advantages. The non-habitual residency scheme (NHR) is a tax regime that can offer huge tax benefits. The Portuguese government abolished inheritance tax several years ago with a stamp duty of just 10% (Imposto do Selo) that may need to be paid.

-Natural Beauty – Strict planning permissions secure natural beauty and limit the supply of new properties thus keeping demand high. For example, Quinta do Lago as part of the UNESCO Ria Formosa bird sanctuary has a strict 8% building restriction. This, combined with excellent facilities for the entire family, help to ensure that the area will continue to be a unique destination and that your investment will prosper.

-Stability – The country is politically stable and has no known terrorism. It is ranked as the 6th most peaceful country in the world according to the Global Peace Index 2022.

-High Rental Yields – Great properties with low prices for high quality and high rental returns. According to statistics expected gross rental yields in Portugal are among the highest in Europe, from 5% to 14% is achievable from the right property.

-Cultural Richness. One of the oldest and richest cultures in Europe and the legacy of its former wealth and power can be seen in its historical sites. Among the sites inscribed in the UNESCO World Heritage List, 13 are located in Portugal.

-Easily Reachable – Portugal is close, easy to reach and affordable. With flight times less than a few hours from most of Western Europe, an abundance of airports and low-cost airlines and as little as 6 hours across the Atlantic from Boston to Lisbon.

-Welcoming People – The Portuguese are some of the oldest British allies, after the Treaty of Windsor in 1386. They are warm, friendly and welcoming whether you are on holiday or a new neighbor.

-They Speak English! Portugal is a very high English-proficient country scoring an average score of 625 on the EF EPI proficiency test. This makes it the 9th best country in the world for English speakers.

-Eating Out – You’ll be pleased to know the price of food and drink remains incredibly low and a 3-course meal at lunchtime – a ‘prato do dia’ – dish of the day can be less than €10 including wine.

-Affordable – Running costs (gas, water and electricity) together with public transport costs are almost a pleasure to pay! Utilities are relatively cheap compared to most other European countries.

-Top Class Healthcare – Healthcare here is top class with many affordable private schemes available. In the 2022 Euro Health Consumer Index, Portugal holds the number 12 slot for public healthcare.

-Afforable Housing – Based on the prices in the UK, Ireland, Paris, Spain and France, property prices in Portugal are still very affordable and allow the option of downsizing to release equity.

-Unbeatable Climate – The combination of hot summers cooled by the Atlantic breezes and warm winter days makes the climate unbeatable. Rain keeps the country green but with short heavy bursts, it’s rare for it to be grey for too long. And the light is incredible!

-Excellent Transport Infrastructure – With three main airports and new motorways spanning north to south and east to west it’s easy to navigate and the roads are incredibly un-congested – even in summer. Public transport by road or rail is frequent, safe and very affordable for those not wanting to drive.

-Low Population Density – It is a beautiful country and the government keeps it that way with strict planning regulations. That keeps the long beaches, countryside and wonderful pine forests free for us to value and enjoy. Portugal has one of the lowest population to land densities in Europe.

-Culinary Delights – With the Atlantic on its doorstep and some of the best growing conditions in the world, some of the finest fish and meat dishes can be enjoyed here at remarkable prices. With the deliciously popular red, white, rose and vinho verde wines you won’t be rushing dinner!

-Great for Investors – The property market is dynamic with property prices continually increasing and with 27 million tourists visiting in 2019 (the last ‘normal’ year before Covid-19) this is causing a scarcity in rental property – much to the delight of investors.

-Business opportunities – the Portuguese market is well known now for being open to technological innovation. It is now much easier to do business in Portugal and the European Union has recognised it as one of the countries that have the most reduced bureaucracy.

-Innovation and technology – Lisbon was the first city in Europe to set up a network of electric car charging stations. Lisbon has Europe’s best fibre optic network and Portugal has pioneered banking and telecommunications services. Close to 60% of the electricity in Portugal comes from renewable sources.

-Work Ethics – Portuguese people have incredible work ethics, appreciate time and know how to balance work and life. These, as well as many other things, might attract both employees as well as employers. Portugal was for a reason chosen by Forbes as the number one country for investments.

Finance & Law about buying property in Portugal

 

When buying property in Portugal, non-residents must pay various taxes, including property tax, individual taxation, and joint taxation. Rental tax applies to property acquired after buying, with a 15% flat tax deducted at the source. Tax rates range from 0.3% to 0.45%, with property in metropolitan areas taxed at 0.8%, and rural regions at 0.8%. Property values updated since 2004 and established prior to 2004 fall between 0.2 and 0.5%, while property owned through corporations in “Black” listed countries is subject to a flat 7.5% tax. The property tax (IMI) does not apply to all real estate, but for a three-year period, permanent or rented out properties are exempt.

 

Real estate in the lisbon

Lisbon is regarded as one of the most fashionable European capitals due to its aura, which is both nostalgic, modern, and historical. One is especially enticed to buy a luxury apartment in one of the distinctive tiled buildings, or “azulejos,” because of the steeply inclined streets, tiled buildings, trams that climb the winding alleyways of the old town, and the breathtaking views from Alfama. Both those looking to build a business or a restaurant as well as those looking for a luxurious penthouse are very interested in the monument-filled, tourist- and local-friendly Avenida Liberdade and Chiado. In the neighborhood of Bairro Alto, which is home to upscale clubs, eateries, and a nightlife that is actually alive, bohemians can buy an apartment.

Reasons to buy house  in Lisbon

1- The number of residence permits granted* Portugal’s Golden Visas scheme is one of the most popular in Europe with non-EU residents (Oct 2012-Nov 2019)

2- 83% Increase in the County of Lisbon’s foreign-born resident population (2008-2018).

3- There is no inheritance tax, gift tax or wealth tax in Portugal

4- PwC ranked Lisbon the tenth best city in Europe for investment and development prospects in 2020.

5- Lisbon is home to three internationally ranked universities with over 18,000 international students.

6- If employed, the Non-Habitual Residence (NHR) tax rule allows for a flat rate of 20% personal income tax and if retired, it offers the opportunity to receive foreign income, including pensions, tax-free.

7- The city’s Metro is being upgraded with two new stations, new lines and the regeneration of Cais do Sodre – the city’s main transport hub for trains, metros and ferries.

8- A cultural heavyweight, the city boasts 44 museums, 9 concert halls and 30 live music venues

9- Competitive on price, €1m buys around 100 square meters in Lisbon compared with 50 sq m in Paris and 35 sq m in London.

10- 40-60% Gross residential yields are higher in Lisbon than many other European cities.