Property in Portugal’s Capital Lisbon

Lisbon is the capital city of Portugal; it is an ancient and beautiful gem with Moorish influences, an historical old quarter and many beautiful sights, museums, monuments and architecture.

The city boasts 20 centuries worth of history, a great climate, easy accessibility to the coast and is becoming a very popular tourist city break destination and Portugal’s latest property hotspot thanks to a number of low budget airlines opening up the city’s accessibility from all across Europe and in particular the UK.

Briton’s are already greatly attracted to Portugal and some 200,000 Brits own homes in this popular country already; but few if any had considered Portugal’s capital city of Lisbon until recently.  The city had earned itself a reputation as being slightly rundown and greatly in need of restoration, and an infrastructure overhaul and as a result property prices in the city were depressed.

Thanks mainly to a glut of EU funding the city is now in the grips of a renovation fever!  Everywhere you look drains and sewage systems are being upgraded, water supplies are being overhauled, main roads, city streets and pavements are being improved and there is an air of regeneration and rebirth! 

The owners of old and dated, worn and run down apartment blocks and city houses are finally seeing the value in improving their properties - few before bothered to renovate property when the outer lying infrastructure issues would have rendered their work effectively useless - after all what’s the point of installing a brand new state of the art bathroom when the sewers are 100’s of years old and unable to cope!

With the intense interest in city property across Europe from Prague to Budapest, from London to Berlin, speculators are now turning their attention to Lisbon and greatly liking what they see!  Currently you can snap up a city centre apartment in Lisbon for as little as EUR 100,000 or a substantial house for a mere EUR 250,000.  Where else in a European capital city can you bag such a bargain?  Where else across Europe is there such potential for capital growth?

The improvement work in Lisbon is set to last for a couple more years yet, but those forward thinking property investors who enter the market now will likely find they are sitting prettily on a hot investment property in years to come.  Lisbon does not yet compare favourably to some other great historical European capital cities - but watch this space - everything that can and should be done to give this city the face lift it needs and deserves is in place and underway.  The experts’ advice is get in now and get in quick.

If you’re interested in purchasing property in Lisbon be prepared to suffer the system!  It is not designed for property speculators to dash in and whip up apartment blocks before turning them around and offering them out for rent in a few short months or even weeks!  Rather the process is slightly slow and expensive compared to that of other rival European countries and buyers have to have a tax card, a fiscal number and a Portuguese address when they apply to purchase.  Many intermediaries such as banks, lawyers and real estate agents can assist with the entire process and getting all the requirements needed in place for you for a set fee.

Fees and taxes add up as follows: -

Lawyer’s fees - up to 2% of the property’s value
Registration of deeds - 1% of the property’s value
Survey costs - upwards of EUR 1,000 (and thoroughly recommended if buying older property)
Utility connection costs - up to 1% of the property’s value
Finance fees - if a mortgage is required these fees can come in at around 2% of the finance total
Home buyer’s tax/stamp duty - up to 7.5% of the property’s value
Transfer tax (not payable on new property) - up to 10% of the property’s value

In terms of securing finance to buy in Portugal it is still incredibly difficult to get local banks to lend to foreign buyers and many find it far easier to arrange a mortgage from a lender in their home country or to extend their own mortgage to purchase.  Whether any of these options suit your own personal financial situation is for a qualified financial adviser to determine, information contained in this article does not constitute legal, financial or investment advice.