The Hidden Costs of Buying Property in Portugal in 2025: What Expats Need to Know

Buying a property in Portugal is an exciting opportunity, but beyond the listing price, there are several hidden costs that buyers often overlook. To avoid surprises and budget correctly, it’s essential to understand all the fees, taxes, and additional expenses associated with purchasing a home in Portugal in 2025.

1. Property Transfer Tax (IMT) – Up to 8%

The Imposto Municipal sobre Transmissões Onerosas de Imóveis (IMT) is a property transfer tax paid at the time of purchase. The amount depends on:

• The property value.

• Whether it’s a primary or secondary home.

• Whether the property is urban or rural.

Example for a second home in Portugal in 2025 (urban property):

• Purchase price: €301,688 – 603,289€

• IMT tax rate: 8%

• Deductible amount: 12,031.21€

2. Stamp Duty (IS) – 0.8%

In addition to IMT, buyers must pay Imposto de Selo (Stamp Duty), which is 0.8% of the purchase price.

For a €500,000 property, this means an additional €4,000.

3. Notary and Registration Fees – €1,000 to €2,500

Finalizing a property purchase requires a notary to legally validate the sale. Notary fees range from €1,000 to €2,500, depending on the complexity of the transaction. Additionally, you must register the property at the Land Registry Office, which can cost €200–€500.

4. Legal Fees – €2,000 to €5,000

Hiring a lawyer is highly recommended to verify property ownership, check for outstanding debts, and ensure the transaction follows Portuguese law. Lawyer fees generally range between €2,000 and €5,000, depending on the property and legal complexity.

5. Survey and Inspection Fees – €500 to €1,500

While not mandatory, property inspections are strongly recommended, especially for older homes. A structural survey and zoning verification can cost between €500 and €1,500 but can save you thousands in future repairs or legal issues.

6. Mortgage Costs (If Financing the Purchase)

If you are taking out a mortgage, consider the following additional costs:

• Bank valuation fee: €250 to €600

• Mortgage arrangement fee: 0.5% to 1.5% of the loan amount

• Life insurance (mandatory with some banks): Monthly premium based on age and
loan amount

7. Annual Property Taxes (IMI) – 0.3% to 0.8% Per Year

After purchasing your property, you will need to pay Imposto Municipal sobre Imóveis (IMI) every year. The rate depends on the municipality and the property type:

• Urban properties: 0.3% to 0.45% of the official taxable value.

• Rural properties: Fixed at 0.8%.

For a €500,000 urban home, the annual IMI tax could range between €1,500 and €2,250.

8. Wealth Tax (AIMI) for Properties Over €600,000

If your share of Portuguese real estate exceeds €600,000, you must pay Adicional Imposto
Municipal sobre Imóveis (AIMI):

• 0.7% on properties valued between €600,000 and €1 million.

• 1% on properties over €1 million.

• Couples can combine their exemption to €1.2 million.

9. Utility and Maintenance Costs

Once you own the property, consider ongoing costs:

• Electricity & water: €100 to €200 per month.

• Condo fees (if applicable): €50 to €300 per month.

• Home insurance: €250 to €800 per year.

10. Residency & Visa Costs (For Non-EU Buyers)

If you’re moving to Portugal, visa and residency costs may apply:

• D7 Passive Income Visa: €90 application + legal fees (€2,000 to €5,000).

• Digital Nomad Visa: €90 to €180 application + legal fees.

• Golden Visa (if still available in 2025): €5,325 per applicant + €10,000 to
€15,000 legal fees.

Conclusion: Budget for More Than Just the Purchase Price

Buying a home in Portugal in 2025 is an excellent investment, but careful financial planning is key. Hidden costs can add 7–10% to your total property price, so be sure to budget accordingly.

At Algarve Home Consultancy, we guide expats through the entire property-buying process, ensuring full transparency on costs and legal requirements.

Need expert assistance? Contact us today!