Posted by Matthew Andrews on May 9th, 2017.
Portugal offers expats of any age the chance to move to a nation where they can lap up the sun in a Mediterranean climate without having to pay the upmarket property prices of the South of France or Spanish coast.
However, if you are one of those people toying with the idea of packing it all up and relocating to the continent, here are three things you should consider before moving to Portugal.
While buying property can often be a tricky and time consuming process no matter where the property is based, there are a few extra legal pitfalls to look out for when buying property in Portugal.
One major legal hurdle all prospective property purchasers should know about when buying in Portugal is the law of subrogation.
This law means that all property debts, including mortgages, local taxes and community charges are transferred upon sale of a property and are inherited by the buyer. This can leave buyers vulnerable to unscrupulous sellers who intend to ‘cut and run’ leaving unwitting buyers in the hole for a previous owners debts.
It is therefore imperative that buyers check that there are no outstanding debts on a property before making a purchase and you are advised to retain the services of an English speaking lawyer and only use a government-registered estate agent to ensure you don’t run foul of this.
It is also worth noting that property in Portugal is often passed down from generation to generation and can often become a tangled mess of ownership, with even distant relatives holding a smallshare, granting them some say in the sale.
Should a family member object to the terms of a sale it could be held in limbo for months or even eventually fall though, so many of those looking to purchase a property to hire a solicitor beforehand.
Making sure that a property has the correct planning permissions is also an important step to buying in Portugal as many older properties were built long before formal planning permissions were in place and you made find that legally your home may jut out onto your neighbour’s land, leading to a potential legal nightmare down the road if it is not sorted out before purchasing.
When purchasing properties in Portugal you should always be wary of buying ‘off-plan’, as many unbuilt homes or properties on new developments can become a headache. If your contract isn’t rock solid you run the risk that you won’t get what you paid for.
While the worst of Portugal’s economic woes appear to have passed, the ghost of past troubles continue casting a long shadow over Portugal’s construction industry and many developers are going bankrupt even now. While a ‘termination’ guarantee should cover any potential financial losses should everything go belly up, it will force you to restart your property hunt all over again to think carefully before committing yourself to a purchase.
Even new builds that are completed can come with issues as local infrastructure projects can sometimes lag far behind the completion of a new development, with proper roads, external lighting and telephone services sometimes taking months to be fully completed, leaving you stranded without key utilities.
While the cost of living in Portugal is generally cheaper than in many comparable European countries, there are a number of unexpected cost associated with living in the nation that it pays to be aware of.
One area in which you may find yourself paying more is if you own a vehicle. Purchasing a car in Portugal can be a major expense and you may find yourself paying thousands of Euros even for an older second-hand car with its best years long behind it. Meanwhile, fuelling your vehicle can also be a costly endeavour as filling the tank costs on average 10-20% more in than other major European countries
Additionally, your insurance premiums are likely to shoot up when driving in Portugal. Portuguese drivers have a notorious reputation, with a penchant for driving fast while holding a very liberal attitude towards following road safety laws contributing to the number of accidents which take place on Portuguese roads. You will also find that traveling on national motorways (while efficient and largely free of traffic) generally involves having to pay a toll, which can make driving any real distance in Portugal a costly affair in toll charges alone.
Many expats living in Portugal also advise that you should ensure that you have private healthcare. While the local health system is generally quite good it is not without its problems and with the UK set to leave the EU in the next couple of years you could soon find that you are no longer eligible for free healthcare whilst abroad.
You should also ensure that you have a generous amount of capital leftover from purchasing a property as you may find that many older homes require some renovations in order to get them up to scratch.
Of course there are many other things to consider when looking to relocate to Portugal and you will want to devote a lot of time to making sure that you have thoroughly researched everything before committing yourself.
However, to help make the move a little easier (and a lot more cost effective) you may want to consider using a reputable currency broker to transfer the money that will be required to relocate to Portugal.
While your first thought may be to use your bank, the more competitive exchange rates brokers are able to offer could save you thousands. You’d also avoid the fees that are often tacked on by banks and will have access to a range of transfer services that can be tailored to suit individual requirements.
If you’re considering moving to Portugal or purchasing property in the nation in the near future, find out more about your currency transfer options.
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