Who am I to tell you this? No one, just yet another expat spending a few years in Portugal. However, I’ve seen more than 100+ houses for sale, inspected them, attempted to buy a home and decided that it’s too dangerous. Let me explain.My family and I arrived in Lisbon in 2020 and for many reasons, we’ve loved Portugal. We quickly found some areas, a school for our kids etc – but housing kept being an area where we simply couldn’t make progress.The Portuguese construction industry has had great problems all the way back to the former financial crisis in 2008. The industry has never truly recovered and yet the demand is exploding. In Denmark where I am from the cost per hour of labour is probably 2-3x higher than in Portugal, yet the houses (building a new family house) is 2-3x more expensive in Portugal for similar specs.So why is the demand so great?Portugal has been in a crisis for a long time and truly tried to get out of it. The solution they thought would be to sell passports to anyone buying a property (Golden Visa) and offer a tax incentive to everyone but the locals.So wealthy and semi-wealthy people have really started the race.In 2018, you could easily find a T1 (1 bedroom) in Lisbon for under €100.000. Now it’s not unrealistic that the price is €350.000-€500.000.The price has literally exploded. There is no longer such a thing as a price per sq. meter. The price is simply whatever the foreigner is willing to pay. SOLD to the highest bidder!But hey! It’s still dirt cheap compared to New York!If just the price was the only thing I could complain about, I would never have written this blog post.Portugal has some of the proudest and patriotic people and this can be confusing:But it’s simply not true. Let’s start from the beginning:
Portugal does not know what isolation is, if they say they do ask them what Rockwoll is…
Because of the cold air from the Atlantic Ocean and the geography of Portugal, it’s simply hard to avoid heavy mould problems when you are not heating your houses. So mould is a real problem!
The windows in Portugal are not to keep the heating in, but simply just to stop the wind.. I’m not joking… If you want real windows, you must import Velux or similar high-spec windows.
Lisbon (where we have done our research) is sitting on an earthquake zone. The history is tragic. There hasn’t been a major earthquake for many years. But with earthquakes, we are sure they will be back one day. Unfortunately, Portugal has some of the worst building quality I have seen. Insane settlement cracks and very little thought is put into earthquake proofing buildings.I would be very scared of what this would mean – yet NO ONE talks about this… Hence why I had to write this blog post!
Ventilation isn’t often well thought out either, so there is a lot of humidity in the air inside. This means you do need to invest in a few larger dehumidifiers from retailers like Worten or Leyroy Merlin.
Alright, now I’m sure I’ve found the perfect property… what is it that I still don’t know?Portugal has a very high transfer tax that is due when you buy the property. This is 0-6%.If you ever want to sell your property again, the real estate agent’s commission is 6-7% and you won’t get anything back on the property tax, so you have to sell your property a good bit more expensive than you bought it to gain a profit.There is NO public record of what the property has been sold for so you have very poor negotiation power to get yourself a good price.
We’ve seen properties for €600k where the bank comes out and values the property to €350k (the real value in their eyes) and says you can have an 80% mortgage of the €350k. So you just need to get €320k in deposit + the 6% (€36k) in property tax.When all of that is said, then I hope you enjoy Portugal. This does not turn us off. Just please keep the above in mind.Mold
Great read!
We came to the Algarve 3 months ago to investigate if this is a place to move and live. I love the weather and beaches, but the property market is absolutely outrageous.
However, the humidity is insane, and the price I pay in rent does not justify the quality of the apartment.
The place I rent now in the low season would sell for approximately 800K. That is insane! Never ever would I pay that for this piece of….
The sad part is that nobody local will ever be able to get into this market. Everything is foreign-owned, and so many houses/flats are just sitting there while the owner is back in their home country.
I met an American the other day, and he was so happy about the new place he bought for €500K a year ago. It is being built now, but it could probably already sell for 700-800K, if not more (the market down in Lagos is mad crazy).
I said I think it’s pretty expensive. He laughed and said ‘i guess it is a matter of perspective. Back home in California, I would pay 5 million for the same’.
I think Portugal is in a bit of a situation that’s going to be hard to get out of.
In my case, I don’t want (or even can) buy a property that I only can get my money back/get profit by finding an even bigger sucker to sell to…
As much as it is nice here in the Algarve and Portugal in general, the quality of life, and the price/quality of what you get for your money, make us decide to go elsewhere, unfortunately.
We were probably five years too late…
Yes agree! My apartment is not habitable without my whirlpool 6th sense dehumidifier. I use it every day. In December I’m emptying 6 liters of water per day. It’s much cheaper to run a dehumidifier than it is a heater. With the dehumidifier running I do not need heaters.
*in your first bullet point you said isolation instead of insulation.
Americans coming over to PT often have been homeowners for decades and therefore cannot switch into even considering being a tenant and have a “landlord”. So they rush into buying with an American mindset of how the renovations will go. Almost everyone I’ve met admit it ended up being 3 years before they could have renovations done where the house was habitable. Also if you move in and the builders leave you won’t get them back to finish for years. The demand is so high. If you found a builder who is available it’s bc they aren’t decent. Any builder who is reputable or reliable is booked 3 years out. So you buy a place and then you wait 3 years before renovations START.
I don’t know how that is preferable to renting. My rent is 560/mo and you just can’t beat that. I have a duplex – 1 bedroom 1 bath downstairs and then a large open loft and bath upstairs. It’s not the best design but it works.
I know more money is to be made by selling dreams but foreigners who don’t have direct experience with Portuguese humidity need to rent 2-3 years before even considering buying.
The stats are 50% of expats/foreigners leave within 3 years. The loudest most excited ones are the quickest to leave when they find the next exciting bandwagon to jump on. And they usually have a YouTube channel.
You are right in many things,but also wrong or misinformed in just as many….I have been living in Portugal since May 1970….the first 45 years in Lisbon and about 8 years ago I moved to Porto. I could comment on SO many things,but it would take ages to write…My best advice..Learn Portuguese as fast as you can…it will make your life so much easier and much better…electric blanket for your bed…buy a fixer-upper,preferably an old house…they are better built and much cheaper…look for the worst house in the your chosen area..Choose what may be an up-coming area and ask for some-one capable to help restore it at your local cafe.Prices have gone up,but it is still possible to find a bargain if you know where to look,but speaking Portuguese is fundamental.
Great read!
We came to the Algarve 3 months ago to investigate if this is a place to move and live. I love the weather and beaches, but the property market is absolutely outrageous.
However, the humidity is insane, and the price I pay in rent does not justify the quality of the apartment.
The place I rent now in the low season would sell for approximately 800K. That is insane! Never ever would I pay that for this piece of….
The sad part is that nobody local will ever be able to get into this market. Everything is foreign-owned, and so many houses/flats are just sitting there while the owner is back in their home country.
I met an American the other day, and he was so happy about the new place he bought for €500K a year ago. It is being built now, but it could probably already sell for 700-800K, if not more (the market down in Lagos is mad crazy).
I said I think it’s pretty expensive. He laughed and said ‘i guess it is a matter of perspective. Back home in California, I would pay 5 million for the same’.
I think Portugal is in a bit of a situation that’s going to be hard to get out of.
In my case, I don’t want (or even can) buy a property that I only can get my money back/get profit by finding an even bigger sucker to sell to…
As much as it is nice here in the Algarve and Portugal in general, the quality of life, and the price/quality of what you get for your money, make us decide to go elsewhere, unfortunately.
We were probably five years too late…
Thank you for sharing your experience 🙂
Yes agree! My apartment is not habitable without my whirlpool 6th sense dehumidifier. I use it every day. In December I’m emptying 6 liters of water per day. It’s much cheaper to run a dehumidifier than it is a heater. With the dehumidifier running I do not need heaters.
*in your first bullet point you said isolation instead of insulation.
Americans coming over to PT often have been homeowners for decades and therefore cannot switch into even considering being a tenant and have a “landlord”. So they rush into buying with an American mindset of how the renovations will go. Almost everyone I’ve met admit it ended up being 3 years before they could have renovations done where the house was habitable. Also if you move in and the builders leave you won’t get them back to finish for years. The demand is so high. If you found a builder who is available it’s bc they aren’t decent. Any builder who is reputable or reliable is booked 3 years out. So you buy a place and then you wait 3 years before renovations START.
I don’t know how that is preferable to renting. My rent is 560/mo and you just can’t beat that. I have a duplex – 1 bedroom 1 bath downstairs and then a large open loft and bath upstairs. It’s not the best design but it works.
I know more money is to be made by selling dreams but foreigners who don’t have direct experience with Portuguese humidity need to rent 2-3 years before even considering buying.
The stats are 50% of expats/foreigners leave within 3 years. The loudest most excited ones are the quickest to leave when they find the next exciting bandwagon to jump on. And they usually have a YouTube channel.
Thank you for sharing your experience 🙂
You are right in many things,but also wrong or misinformed in just as many….I have been living in Portugal since May 1970….the first 45 years in Lisbon and about 8 years ago I moved to Porto. I could comment on SO many things,but it would take ages to write…My best advice..Learn Portuguese as fast as you can…it will make your life so much easier and much better…electric blanket for your bed…buy a fixer-upper,preferably an old house…they are better built and much cheaper…look for the worst house in the your chosen area..Choose what may be an up-coming area and ask for some-one capable to help restore it at your local cafe.Prices have gone up,but it is still possible to find a bargain if you know where to look,but speaking Portuguese is fundamental.