Tuesday, 04 May 2021

Selling a property in Portugal

VolverSelling a property in Portugal is a process that, depending on the situation (the documentation that is available, who are the owners, rights and encumbrances, and registrations, etc.) may, sometimes, prove to be challenging. Although each process raises questions of its own, there are some mandatory steps that must be taken into account before selling your home in Portugal.

Set the price

To set an appropriate price, it is important to know the market value of the property that will be sold. You can do your own market study, by comparing your property with others with the same number of rooms, state of conservation, areas and location. The improvements that were made, parking space, sun exposure and other features such as balconies and storage are also relevant features to consider when evaluating the property.

By setting a realistic price you will be able to sell the property within a reasonable time frame.

Decide whether to sell the property on your own or hire a real estate agency

Nowadays there are several tools that allow you to advertise your property. In addition to the traditional sign with the word “for sale” and a mobile number, it is possible to reach a larger number of potential buyers by using social networks and the various sites dedicated to advertising properties, such as www.idealista.pt

If you choose to hire a real estate agency, the agency will advertise and promote the property, manage any contacts with potential buyers, schedule and carry out visits, negotiate the price, inform about the documentation that shall be gathered, etc ... However, you should into account the cost of the commission that will be charged when the property is sold which, as a rule, varies between 3% and 8% on the value of the sale of the property.

Gather the necessary documentation

Several documents will be necessary for each stage of the sale process. As so, the best way to speed up the process will be to gather the necessary documents as soon as possible.

Some of the most relevant documents are:

 •Land Registry Certificate (Certidão de Registo Predial)

This document can be obtained at the Land Registry Office. It shows the property's history, the rights that were registered, including those that are pending, and proves the ownership. The land registration certificate is valid for 6 months and can be requested online and it costs € 15.

 •Tax Land Registry Certificate (Caderneta Predial)

The tax land registry certificate reports the tax status of the property as well as other relevant information such as the location, description, identification of the owners and the property's equity value, which will allow the calculation of the Municipal Property Tax (IMI).

 •Licence of Use (Licença de utilização) This document describes the type of use for which the property is intended, that is, whether it has a residential or non-residential purpose. To issue this document, it is necessary to go to the City Council of the region of the property.

 •Blueprints

This document shows the exact distribution of the property areas, in addition to containing information informing about the size and location of the garage, storage, etc. It is possible to consult the blueprints of the property in the municipality where the property is located.

 •Energy certificate

The Energy Certificate assesses the energy efficiency of a property on a scale from A + (very efficient) to F (inefficient), issued by technicians authorized by the Agency for Energy (ADENE). It is mandatory since 2013 for anyone who intends to either sell or rent a property.

 •Technical Document of the House (Ficha Técnica da Habitação)

This document contains relevant information regarding the architectural project, characteristics of the work and describes the changes made in the property. If the property was built before March 2004, this document is not be necessary for the deed to take place. In case a duplicate is needed, you must request it from the municipality for a fee.

Promissory agreement

In most cases, after an agreement is reached and before the public deed of purchase and sale takes place, it is recommended for the parties to draft and sign a promissory agreement of purchase and sale in order to bind them to the terms and conditions that were agreed.

In a promissory purchase and sale agreement, the terms of the purchase must be predicted, such as:

• Identification of the seller and the buyer

• Property identification

• Price

• Description of how the payment will take place

• A date for the purchase to be concluded

A promissory agreement is not mandatory. However, it is a common procedure that takes place, for example, when the buyer needs to apply for a bank loan or, for any other reason, the parties are not ready to move forward with the deed.

The promissory purchase and sale agreement should always be carefully reviewed by a qualified professional since the inadequate wording may result in the loss of the value of the deposit, which, in in some cases, it may reach up to 30% of the agreed price total.

Public Deed

The deed of purchase and sale may be carried out at a Notary's Office, Land Registry Office or even through Casa Pronta, a one-stop shops created so that all necessary formalities for the purchase and sale can take place at the same place.

Finally, it is important to remember that the Real Estate Transfer Municipal Tax (IMT), stamp duty and acquisition costs are paid by the buyer.

Real Estate Law department | Portugal

 

Belzuz Abogados SLP

This publication contains general information not constitute a professional opinion or legal advice. © Belzuz SLP, all rights are reserved. Exploitation, reproduction, distribution, public communication and transformation all or part of this work, without written permission is prohibited Belzuz, SLP.

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