If you’ve ever dreamed of owning a home in Europe, Portugal might just be the perfect place. With its stunning coastline, affordable cost of living, and welcoming atmosphere, Portugal has become a top destination for Americans looking to buy property abroad. Whether you’re considering a second home, an investment property, or planning to relocate permanently, understanding the process of buying real estate in Portugal as an American is something you might want to be looking into.
Why Americans Are Choosing Portugal
Portugal has seen a surge in interest from American buyers in recent years. But what makes this country such an attractive option? Here are the top reasons why Americans are flocking to Portugal:
- Safety and Security – Portugal is one of the safest countries in Europe (indeed, the world), with low crime rates and a peaceful atmosphere, making it an excellent choice for retirees and families.
- Cost of Living – The cost of living in Portugal is significantly lower than in the U.S. A comfortable albeit modest lifestyle for a couple can be maintained for around €2,500 per month, including housing, dining, and entertainment.
- Quality of Life – Portugal offers a high standard of living with beautiful beaches, historic cities, and a laid-back culture.
- Strategic Location – Portugal provides easy access to the rest of Europe and is well connected to the U.S., with direct flights from major American cities.
- Growing Expat Community – With an increasing number of international residents, including many Americans, Portugal has a vibrant and welcoming expat network.
- Friendly Locals – The Portuguese are known for their hospitality, making it easier for foreigners to integrate into local communities.
Where to Buy in Portugal
Portugal offers a diverse range of locations to suit different lifestyles and budgets. Here are some of the most popular areas for American buyers:
Lisbon: The Urban Hotspot
As the capital city, Lisbon is a favorite for those who enjoy the energy of city life. It offers a mix of historic charm and modern convenience, with excellent restaurants, cultural attractions, and nightlife. However, real estate prices in prime districts like Santo António and Estrela can be high, with apartments averaging around €700,000 for 120 square meters.
Cascais: Luxury by the Coast
Just a short drive from Lisbon, Cascais is known for its luxury real estate, beautiful beaches, and upscale lifestyle. It is a popular choice for wealthy buyers seeking ocean views and a high-end living experience.
The Algarve: Retiree’s Paradise
With its warm climate, stunning beaches, and relaxed lifestyle, the Algarve is a favorite among retirees. Home to over 50,000 British expats, the region is extremely international, with plenty of golf courses and resort-style living.
Oporto: Affordable Charm
Oporto is Portugal’s second-largest city and is known for its charming riverside views, vibrant culture, and growing tech scene. It offers more affordable real estate options than Lisbon, making it attractive for young professionals and digital nomads.
Silver Coast & Central Portugal: Hidden Gems
For those looking for a quieter, more affordable option, the Silver Coast and central Portugal offer incredible value. Cities like Nazaré and Obidos provide stunning coastal landscapes and authentic Portuguese culture at a fraction of the cost of Lisbon and the Algarve.
Timing is Everything in Life
Understanding the Buying Process
Buying property in Portugal is relatively straightforward, but it does require careful planning. Here’s a step-by-step breakdown:
1. Research and Find a Buyer’s Agent
While online portals like Idealista can help you browse listings, hiring a buyer’s agent (or property finder, as they’re called in Portugal) can make the process much easier. A buyer’s agent will guide you through the market, negotiate on your behalf, and help you avoid common pitfalls.
2. Choose Your Location & Budget
Your budget and lifestyle preferences will determine where you should buy. Properties near the coast or in major cities tend to be more expensive, while rural areas offer much more space for your money.
3. Viewing and Selecting a Property
If you can’t visit in person right away, many agents offer virtual tours. Once you find the right property, your agent will assist with negotiations.
4. Making an Offer & Signing a Promissory Contract
In Portugal, once an offer is accepted, both parties sign a “Contrato de Promessa de Compra e Venda” (Promissory Contract), and the buyer typically pays a deposit of 10-20%. If the buyer backs out, they lose the deposit. If the seller backs out, they must return double the deposit.
5. Due Diligence & Legal Checks
Your lawyer will conduct due diligence, ensuring there are no legal issues with the property, verifying ownership, and checking that all permits are in place.
6. Final Deed & Transfer of Ownership
The final deed (“Escritura”) is signed at a notary’s office, and the remaining balance is paid. The property is then registered in your name.
Financing Options for Americans
If you need a mortgage, Portuguese banks do offer financing to foreigners. Typically, American buyers must put down at least 40%, and interest rates range between 3-4% with loan terms of up to 40 years (but the term will not exceed 75 minus your age – so if you are 55, you can’t get longer than a 20 year mortgage). Mortgage approval is based on income, which can be from the U.S. or Portugal.
Residency & Visa Options
If you plan to live in Portugal full-time, you’ll need a residency visa. Options include:
- D7 Visa (Passive Income Visa) – Ideal for retirees or those with independent income.
- D8 Visa (Digital Nomad Visa) – For remote workers earning at least €3,040 per month.
- Golden Visa – Previously available through real estate investment, but now only applicable for investment funds with a minimum of €500,000
Rental Income & Taxes
If you don’t plan to live in Portugal year-round, you can rent out your property. Short-term rentals (Airbnb) require a special license, and in some areas, like Lisbon’s historic districts, new licenses are no longer being issued. Long-term rentals (1+ months) are always allowed.
Property taxes in Portugal are relatively low. You’ll pay an annual property tax (IMI) ranging from 0.3% to 0.45% of the home’s value, plus small transaction fees at purchase.
Is Now the Right Time to Buy?
The Portuguese market has seen rapid growth, particularly after COVID-19, but prices remain attractive compared to the U.S. High-demand areas may see stable or increasing prices, while lesser-known regions may offer more opportunities for value appreciation.
Final Thoughts
Portugal is an incredible destination for Americans looking to buy property abroad. With its affordable cost of living, high quality of life, and diverse real estate options, it’s no wonder more Americans are making the move. Whether you’re looking for a vacation home, retirement retreat, or an investment property, Portugal has something for everyone.
If you’re ready to explore your options, connect with a trusted buyer’s agent who understands the market and can help you find the perfect property. The best place to start is by visiting DeBrito Properties and exploring some of the local inventory to get an idea of the different localities and housing options.
Here are some other ways to find DeBrito Properties:
When you’re ready to take the next step, you can reach out to them quickly via WhatsApp.
You can also reach César de Brito directly via email at [email protected]
Time to talk to a REALTOR?
Silicon Valley Luxury Homes for Sale
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
