Buying a property
Buying and selling a property In order to finalize the purchase or sale of your property, you must submit various documents that identify the property and that confirm the legitimacy of the owner and the buyer. The acquisition of property in Portugal, because it is subject to the payment of taxes, requires that you register with the Tax Authorities to obtain the corresponding taxpayer identification number (NIF). The following documents are necessary before conclusion of a sale:
- Land Registration (Certidão do Registo Predial) The information made available by the land registry tells you about the composition of a certain building, the legitimacy of the person intending to sell the property and the types of encumbrance that may affect it (mortgages, collateral, etc).The land registry certificate may be requested in the following ways, in hard copy or in digital format:In person, at any land registry office (Conservatória do Registo Predial) (see list). This entity holds full descriptions of properties;It is possible to request a permanent land record certificate and simplified land information through the Predial Online website: www.predialonline.mj.pt
- Financial Registration (Caderneta Predial)This document may be requested from any tax office (finanças). It contains information about the property's tax situation and can be used to find out which entity is responsible for meeting fiscal obligations related to the property.
(Caderneta Rustica) This is a similar document to the Caderneta Predial, but only for rustic properties. It gives the same information, but also identifies trees by type and size. Property owners can get the “Caderneta Predial” and the “Caderneta Rustica) for their properties from the tax authority website: http://www.portaldasfinancas.gov.pt/at/html/index.html.
- Habitation Licence (Licença de Habitação/Utilização)The purpose of this licence is to certify that the house is build according the building regulations for that area and that the building is constructed according to architectural drawings which are approved by the Townhall (Câmara Municipal) For buildings other than a house a Usage licence (Licença de Utilização) is needed. These documents are obtained from the council (Camara).
- Pre-1951 Certificate. When a property was constructed before 1951, a certificate is required to prove this. This pre-1951 certificate is normally provided by the local council.
- Plans All properties that have a habitation license will have plans filed at the local council. It is important to check the registered plans against the actual construction, as this is often the only way to pinpoint any illegal parts.
- Technical datasheet (Ficha Técnica)The Technical datasheet is a document that describes the technical materials and how much has been used for this house. This only needed for houses that are built after 30th of March 2004
- Energy Certificate (Certificado Energético)This can be submitted by a certified engineer and it describes the efficiency of insulation and heat elements of the property.
- Borehole and Septic tank licence if the property has these facilities.
Promissory contract (Contrato de Promesse) This is usually prepared by the lawyer of the buyer. Typically this contract will include the identification of the parties and property to be sold, the price for the purchase and sale, the date for the public deed and all other agreed terms and conditions for the transfer of the property. A deposit of 10 to 15% is usually agreed between the parties and paid upon signature of the promissory contract. The Portuguese law protects both parties, on one hand, if the purchaser does not fulfill the promise of buying the house he will lose the deposit, on the other hand, if the seller changes his mind or cannot fulfill the promised agreement he has to return twice the deposit made by the purchaser. Usually both parties are being represented by a lawyer who will oversee all legal activities.
Final Deed (Escritura de Compra e Venda) The final deed is in principal very similar to the promissory contract. The notary checks all documentation and sees that the IMT (property purchase tax) has been paid. At this stage, the full purchase price is also paid. From time to time and with the agreement of both parties, a part of the purchase price may be withheld from the vendor until certain aspects of the deal are fulfilled. For example, there may be a snagging list to deal with. In these circumstances, the buyer's lawyer generally holds the 'retention' until all paperwork and other outstanding issues are resolved. Once the deed and all other associated transactions are completed, the buyer's lawyer registers the new owner of the property in the Land Registry (Registo Predial). Buyers should request a copy of this registration for their files.