Property Investment in Portugal

[Thomas Youngman]

Hi,

The purpose of this post is to connect with anyone interested/actively investing in the Portuguese Real Estate market. 

I am moving to Portugal in March 2019 and wanted to connect with fellow Property investors. There seems to be an interesting investment case for Portugal currently and by building a supportive network of investors we will be able to discuss opportunities and build our experience faster than if we go it alone

When I arrive in March I will be focusing on learning the market and seeing which strategies will work for me. 

Thanks

Thomas

[Thomas Youngman]

Hi,

For what it is worth below is my current understanding about mortgage financing in Portugal. Based on this some elements of my REI strategy are going to need to be adapted!

1.To extract equity in your property by re-mortgaging if you brought the property with a mortgage is normally not possible, it might be if you have extensive building improvements.

2.Getting a mortgage on a property you own 100% of is usually possible. Its usually called a post-completion or post-purchase mortgage. It is usually allowable up to 6 - 12 months after the purchase.

3.Buildings are determined as commercial or residential based on the official cadastral category by the local council.

4.Commercial mortgage LTV Max 60% depending on the specifics.

5.Not an issue using foreign income for affordability calculations if salary is taken into account.

6.Property valuation is conducted by a valuation company requested by the bank.

7.Residential mortgages can be up to around 80% LTV depending on affordability.

8. Banks never allow residential mortgage affordability to be based on the income of the property itself