I mean – first off, we bought a forever home! We initially rented, wanting time to understand what it was like to live in our chosen town, see whether it would become home and all that. And we love it here. So we set out to find a “here” of our very own. And it was exactly like buying a place in the US. Except when it wasn’t.
Looking for a home
Let’s start here: There is no MLS in Portugal. No central real estate listing of any kind.
Real estate offices have their own web sites. Some big operations have a ‘company’ web site that kind-of-gathers listings from all their affiliate officers. And a few sites either aggregate these, or at least allow them to cross-list. Nobody has the secret Mast List of Available Properties. And even where properties are listed – not all the properties are, necessarily, listed.
We started our search on two web sites: ReMax and Idealista. ReMax – yes, that’s the same folks you know from the states. Kinda. They have decades of history in Portugal, and have worked to make a pretty extensive national database of ReMax-represented properties. Idealista has a mix of By-Owner and agent listings.
There’s a limit to how many properties an agent can list for free, and each office uses different criteria to decide which ones they list. So looking on idealista involves a lot of back and forth. Review listings, hide 3 or 4 copies of the same listing. track the ones you like back to their real estate office. Go to their web site and look at the rest of their properties.
And, of course, a lot of communication with your agent (you’re going to have an agent. It’s not even a question.), who will tell you about a few more properties that you can’t find on any web site.
Connecting the dots
I watched listings for two years. By the time we were ready to look, I had a pretty good idea of what we could hope for in our price range, some things I wouldn’t have known to look for without having seen a lot of listings, and – all that stuff. When we were finally ready to move forward with an active search, I had a feel for the market. I even had my eye on the best apartment we’d seen so far. It had been listed for a couple of months and when we were ready to go – all the listings disappeared but one.
Well drat.
It wasn’t far from us, and we walked past it a few days later – only to discover that there were bran new for sale signs up. The owners had switched agents! It was, indeed, still on the market. We scheduled a visit.
And the next day, it was cancelled.
There was a lot that happened next but the bottom line was, the seller’s agent didn’t really want to sell to us. She finds Americans troublesome. Apparently we want a lot of inspections and things, and it slows stuff down. Her client wanted to finish the process swiftly, by the end of the tax year, and she didn’t want some random American getting in the way of that.
Fortunately, we have a resourceful agent, and in the end – we got our viewing.
Checking out a property
We were very fortunate. Our agent and other friends were familiar with the building and able to tell us things about it. It was built in 2001, as a high-end/luxury property – some of its first occupants were players for the nearby pro soccer team. The builder is well regarded in our town – friends were able to name other quality buildings they had built. the current owners were not the first owner but the second – and had been there for nearly 20 years.
The property was well kept, and we felt confident about it overall. It would need some “refreshing” and minor “updates” but unless we saw something of concern, we felt OK about it, even without the supports we normally have in the US. Which was a good thing – because overall home inspections are not really a thing here. There are folks who do some types of inspections, and if you get a mortgage, the bank might do so, but overall the kind of overall property review that was mandatory for our VA-supported home loan in the US is…not really a thing.
So we walked through the apartment, saw exactly the signs of “20 years old” that we expected, and nothing else that concerned us or our agent. We had discussed in advance what things might be a barrier or cause a pause – and we saw none of those things. The house was immaculately kept and it was clear the owner took pride in it. Understanding the seller’s timeline concerns, the very competitive market, and the fact that they already had at least one offer on the table, we had decided in advance that if we didn’t see any concerns, we’d make an offer on the spot. And we did.
A word to the wise
If we were buying an older property, a standalone house with larger structural and land scope, a property that showed any signs of hard use – there’s no way we would have done it without hiring someone to do those inspections. It was a bold move on our part, but a calculated risk and it has worked out. But if you’re planning to buy in Portugal – unless you have all the same ‘odds in your favor’ circumstances, I can’t advise it.
If we were younger/not retired, we might have considered a mortgage, just to build credit history here. but – we’re older, so if we could qualify, it would be for a shorter term mortgage. There doesn’t appear to be any ‘early payoff’ option in Portugal. And being unemployed, we’d have a hard time meeting the credit requirements. We knew all that, and had already planned to use the money from the sale of our house in the US for the purchase. That set our budget for us, and helped us plan.
Making an Offer
We made a verbal offer – but that doesn’t actually mean much. Soon thereafter, our agent contacted us to set a time to sign the offer documents.
We all met – both agents, buyers and seller, and an attorney who is a notary – to sign the offer document. It laid out, on our side, the amount of the offer, the initial payment (similar to US “earnest money”) and the number of the bank account to which it would be paid. On the seller’s side, it enumerated any outstanding mortgages or claims on the property, and their obligation to clear those prior to the final sale. At the time of signing, we were required to pay the initial payment via bank transfer.
At that point, there is a binding process occurring. If we pull out, we lose the cash. If they pull out for any reason (other than breach), they would owe us double our money back.
The Actual Purchase
Over the next few weeks we got copies of the official descriptions of the property, the history of mortgage and sale activity, and had the chance to review and ensure they matched what we thought we were buying, for both properties. Yes, both: our garage is a separate legal deed, and has its own identity. It can be bought and sole separately from our apartment, so it has its own legal presence.
We also received a copy of the apartment’s Energy Certificate. This is an assessment of the property’s energy efficiency, compared to an established “ideal”, and in addition to the overall grade, it comes with a four or five page document outlining potential energy improvements, with their estimated implementation cost and related annual energy cost savings. In Portuguese.
C’mon – I’m a geek! I opened the energy certificate in my PDF app, exported it to a Word document, and then used the MS translator function to translate it. We added a few of the recommended updates to our list of “updates and refreshes to do before we move in”.
The day before the Big Meeting, we went to the bank to request (the equivalent to) a cashier’s check for the remaining amount of the sale. Meantime, the real estate attorneys verified the debt status, and the ownership status of the property. There is no title insurance here – the attorneys check the history of the property in the central database, ensure there are no outstanding claims, etc. (Your agent has an attorney who is practiced at this. It’s one of the main reasons you will have an agent.)
On the big day, everyone-and-the-lawyer gathered again. Everyone’s identity was verified and their ID numbers recorded. Even the lady we brought as a translator has her ID info recorded in our sale contract.
Every detail of the sale contract was verified. We handed over the check, and the sellers handed it over to their banker – who then signed off on the cancellation of debt for the existing mortgage and verified for the lawyer that the property was debt free.
The lawyer then read every word of the contract out loud, in the presence of every party to the contract. Once everyone had clearly heard the same thing and had an unambiguous understanding of what was being signed, two copies of the contract were handed around. We all signed both copies, initialed each page in the top right corner so nobody could insert things later, and each party to the sale got an original signed copy.
The attorney, who served as our notary, scanned copies – because notarized documents are stored in a central database and can be looked up there later. Then we paid taxes – property transfer tax and stamp duty, all calculated the day before the sale and presented in writing. We paid via bank card. And the sellers handed over the keys.
Unexpected complications.
In the U.S., Title companies confirm and guarantee “clear title” – ensuring that there are no conflicting claims of ownership on the property or questions about the seller’s legal right to sell. In Portugal, the lawyers do this. You can look up information about a property online if you have access to the right databases.
But…
One contributor to Portugal’s housing challenges is the number of empty houses waiting for families to do something with them. Portuguese inheritance law is very different from the US – first and foremost, in that it ensures you can’t disinherit a direct family member. It’s a different way of looking at wealth than the US’s “individualistic” approach: you benefited from your own family, upbringing, and connections, and your wealth is shared with them when you die.
Except that every family has That One Person. When 31 people agree to sell grandpa’s farm, but #32 refuses – nothing moves forward. Some family members may release their claims and allow the others to work forward – but nothing happens until that one holdout reaches some kind of agreement. Or is found – it may be that they would be willing to release their claim if anyone knew where they were.
As you can imagine, that can get complicated – and it’s just one way in which ‘clear title’ can get confusing.
For example, it’s not uncommon for careless buyers to purchase a farm, for example – and only later realize that they have purchased the “back 40”, where all of the buildings are classified as agricultural outbuildings. There goes their plan to remodel and live in on – agricultural buildings aren’t eligible for an occupancy permit.
Or to purchase a beautiful old home, only to discover that it’s subject to statues imposing limits on remodeling and requiring historical restoration. Or a lovely home that does not have an occupancy permit, and can’t get utilities and services.
There’s a lot to know. And if you didn’t grow up here, you’re probably not going to know it. Take a risk on a property inspection. Take a guess on a neighborhood, even, if you feel like it ‘seems OK.’ But do not take the kind of risks involved in not having a lawyer reviewing your interests when buying a property in any new country.
After the Sale
We immediately visited the apartment to see that it was empty and in good order. We tested the keys, located all the utility meters and recorded their numbers. Then we went to the “city store” – a retail site in the central area of the city housing some city offices and outlets of the major utility providers – to transfer the gas, electric, and water services.
Gas was expensive here before the Russians’ pipeline deal ended, so we knew we would be replacing the aging gas stove with an electric oven and hob. But the seller had replaced the thermoaccumulator (hot water heater and boiler for radiator heat) with a really efficient new gas unit less than two months earlier, so we thought we’d let that run and see what the cost of heat and hot water looked like in our new place.
The gas company conducted a site inspection before turning on service. It seems that the seller didn’t have their installation inspected after that change – the extractor from the hob was venting back to the hot water heater closet. When the fan was turned on, it took less than two minutes for the Co2 levels to rise to dangerous levels in the kitchen. Our inspection was stamped “critical fail”; the gas turned off and we added “replace the HVAC with electric” to our list of pre-move improvements.
Even with the exchange rate, we got our new place at a price that left a good nest egg for improvements in our ‘house fund”. Whew!
The next adventure
And now, we’re working with a contractor to have those updates made, and that’s a whole different adventure! We really hoped we could have that work done in January and move in by the end of that month. So of course, we plan for it to be done in February – and hope it will be done in March. Because moving to Portugal is about learning patience.
Our three year lease began in January 2024. So in January 2025, we have completed 1/3 of the lease and we’re able to give the four months’ notice required by our lease. So we have our current rental til the end of May – which means if we can move in March or April, we’re in great shape.
I must admit, this part is – not relaxing in any way. But once it’s done, I’ll have a lovely ‘winter garden’ to sit in with a cup of coffee and a good book to destress all summer long…
