What is the cost of buying property in Lisbon? If you’re planning to move to Lisbon and buy a home, understanding the true cost is critical. Many buyers focus solely on the price tag of the property—but that’s just the beginning. Between taxes, legal fees, and ongoing expenses, the full financial picture includes several key layers. The good news is that with a little foresight, none of it has to be a surprise.
Let’s walk through everything you’ll need to budget for—from the moment you make an offer to years after the keys are in your hand. We’d be happy to help you through this whole process. Contact us. Whether you are moving in 9 days or 9 months, we can help.
What You’ll Pay Upfront When Buying Property in Lisbon
The foundation of your purchase, of course, is the agreed price between you and the seller. That figure is typically based on market trends, location, condition, and negotiation. But once you’ve settled on the price, there are several other charges you’ll need to factor in before the property officially becomes yours. The true cost of buying property in Lisbon is what we are after today.
One of the largest is the Property Transfer Tax, known in Portuguese as IMT (Imposto Municipal sobre Transmissões Onerosas de Imóveis). This is paid by the buyer before the final deed is signed and varies depending on whether the home is a primary or secondary residence, and its overall value. Most residential properties fall somewhere between 1% and 8% for IMT. For instance, a €500,000 primary residence typically triggers an IMT of around €14,000 to €16,000. Portugal even offers an official calculator online to help estimate your exact rate.
Next comes Stamp Duty, which is far simpler. This is charged at a flat rate of 0.8% of the purchase price and is due at the moment the deed is finalized.
You’ll also need to budget for notary, registration, and legal fees. The notary handles the preparation and witnessing of the final deed and usually charges between €600 and €1,200. The land registry will charge another €250 to €500 to record the property in your name. Legal representation isn’t mandatory, but it is strongly recommended, especially for foreign buyers. Most lawyers charge between 1% and 2% of the purchase price depending on the complexity of the sale and whether you’re buying remotely.
If you plan to finance your property with a mortgage, additional costs will apply. Portuguese banks typically charge for the loan arrangement and property appraisal—usually adding up to another €1,000 to €2,000. You’ll also be required to purchase life insurance and property insurance, both of which are usually bundled with the loan package.
A Sample Cost Scenario: What a €500,000 Property Really Costs
Let’s say you’ve fallen in love with a modern €500,000 apartment in Lisbon. Beyond the price itself, you might expect to pay another €14,000 to €16,000 in transfer tax, €4,000 in stamp duty, €1,000 to €1,700 in notary and registration fees, and between €5,000 to €10,000 in legal representation. Altogether, you’re likely looking at an additional €24,000 to €31,700 in upfront costs.
These figures are estimates, of course, and may vary depending on your specific situation. But they provide a realistic range for what most international buyers encounter when closing a deal in Lisbon.
What It Costs to Own Property in Lisbon Long-Term
Once you’ve settled into your new Lisbon home, your financial responsibilities won’t end. Ownership comes with a handful of ongoing obligations that are important to budget for on an annual—and sometimes monthly—basis.
First and foremost is the Municipal Property Tax, known as IMI (Imposto Municipal sobre Imóveis). This is paid by all property owners in Portugal and is based on the property’s official tax value, or Valor Patrimonial Tributário. In Lisbon, IMI rates generally range from 0.3% to 0.45% per year. For a property with a tax value of €300,000, your annual IMI would fall somewhere between €900 and €1,350.
If you purchase an apartment in a building or a home within a gated community, you’ll likely owe condominium fees as well. These cover maintenance of shared spaces, cleaning, security, and facilities like pools or gyms. Depending on the amenities, fees can range anywhere from €30 to over €300 per month.
Your basic utilities—electricity, gas, water, and internet—tend to fall between €100 and €200 per month, depending on usage and the size of your home.
Home insurance is another cost to plan for. While it’s required if you take out a mortgage, it’s wise to have coverage either way. Expect to pay between €150 and €300 annually for a good policy.
Finally, don’t forget to budget for ongoing maintenance and repairs. Older buildings in Lisbon can be charming, but may require regular upkeep. A safe estimate is to set aside about 0.5% to 1% of your property’s value each year to cover unforeseen repairs and updates.
Hidden or Unexpected Costs You Should Know About
Some costs won’t apply to everyone—but they’re worth knowing in case they come into play.
If you sell your Lisbon property down the line and make a profit, capital gains tax could apply. The rules are nuanced, and you may qualify for partial or full exemptions if it was your primary residence or if you reinvest in another property. Talk to a tax advisor before selling to understand how to minimize your exposure.
Wealth tax—officially known as AIMI (Adicional ao IMI)—applies to high-value properties. If your share of a property is valued at over €600,000, you may owe between 0.7% and 1.5% annually on the value above that threshold.
Planning to rent your Lisbon property on Airbnb or other short-term platforms? You’ll need an Alojamento Local license, which comes with fees and additional tax obligations. It’s also important to note that short-term rental licenses are increasingly regulated and restricted in Lisbon. It is impossible to get a new A.L. license in Lisbon now.
How to Plan Wisely for the Full Cost of Ownership
The best advice? Never rely on the sticker price of the home alone. Work closely with a trusted real estate agent and attorney to get a full cost breakdown before you sign anything. Ask for upfront estimates on all taxes, notary fees, and ongoing costs like condo fees and utilities.
If you’re buying a fixer-upper, be proactive: request detailed quotes for renovation work. Make sure you understand who’s responsible for what in a shared building.
In Summary: Transparency Is the Best Investment
Lisbon continues to offer exceptional value for international homebuyers—but only if you go in fully informed. By understanding the full financial picture—not just the price tag—you’ll avoid unwanted surprises and be better prepared for a smooth, confident transition into your new life in Portugal. Again, the true cost of buying property in Lisbon is what is important to understand.
With our expert guidance and the right planning, your Lisbon property journey can be as rewarding financially as it is personally. Contact us. We are happy to help you make a smooth move to Lisbon.