Property Buying Tips for Foreigners Moving to Lagos, Algarve
For many foreigners, buying a home in another country is a major life step and decision. Some are looking for a permanent move, drawn by the Algarve’s lifestyle, others may see it as a smart investment or the perfect holiday home. Whatever the reason, the process comes with key considerations that many buyers don’t anticipate. But beyond the excitement, there are key considerations that buyers often overlook.
The question is, what should you know before purchasing a property in Lagos to ensure a smooth and successful process? If you’re planning to buy property in Lagos, understanding the market, legal requirements, and lifestyle considerations will help make the process smoother. Here’s what you should keep in mind before taking that exciting next step.
Research the Lagos Property Market
Prices vary depending on location, property type, and proximity to the coast. It’s essential to research current market trends, compare listings, and get a feel for the pricing landscape before making any decisions. As of this year, the average property price in Lagos has risen by approximately 7% year-on-year, with beachfront properties seeing even higher demand. The rental yield for short-term holiday lets in Lagos is currently averaging around 6-8%, making it an attractive option for investors.
Understand the Legal Requirements
Buying property in Portugal as a foreigner is relatively straightforward, but there are legal steps you need to follow. You’ll need a Portuguese tax number (NIF), which is required for all financial transactions, including property purchases. You’ll also need to hire a solicitor to guide you through contracts, property registration, and ensure there are no legal issues with the property.
A promissory contract (Contrato de Promessa de Compra e Venda) is usually signed first, followed by the final deed (Escritura) upon completion.
For a more detailed look at the buying process, you can read more here.
Factor in Additional Costs
Many buyers focus on the property price but forget about additional expenses. Expect to pay IMT (Property Transfer Tax), stamp duty, notary fees, and legal costs, which can add up to around 6-8% of the purchase price. If you’re financing the purchase with a mortgage, bank fees and insurance costs should also be factored in. Understanding these costs from the start will help you budget more effectively.
Consider Residency and Visa Options
If you’re moving to Lagos permanently, you may need to apply for residency. Portugal’s D7 Visa is popular among retirees and remote workers, allowing non-EU citizens to live in Portugal if they have sufficient income. The Golden Visa scheme, which provided residency for property buyers, is no longer available for residential properties in Lagos, but there are other routes to explore. The D class visas have proven to be a popular route to residency in Portugal for retirees, entrepreneurs and digital nomads.
Choose the Right Location
Lagos is known for its historic centre and marina while boasting a vibrant expat community, but different areas offer different lifestyles. The town centre is ideal for those who want to be close to restaurants, shops, and the marina. Meia Praia and Porto de Mós are great for beachfront living, while quieter areas like Almádena or Espiche offer more space and tranquillity. Think about what suits your lifestyle best before choosing a location.
Work with Local Real Estate Experts
Navigating the buying process in a foreign country can be challenging, so having the right professionals by your side is essential. A reputable real estate agent can help you find properties that match your needs, while a lawyer ensures all legal aspects are in order. A local mortgage broker can assist if you’re financing the purchase. Having a team of trusted experts will make the process smoother and more secure.
If you're looking for expert guidance, B&P Real Estate is here to assist you in finding your perfect home.
