Can an expat get a house mortgage in Portugal? Let’s dive into the details, interest rates, how to qualify and who to contact!

Last Updated on March 11, 2024 by Laila Oliveira

Portugal has emerged as a top destination for expats seeking diverse landscapes, rich cultural heritage, and favorable living conditions. With increasing popularity and a growing real estate market, expats have found their new home away from home. It makes you think, can expats get a house mortgage in Portugal? And how? 

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The Portuguese Association of Residential Tourism and Resorts (APR) is optimistic about 2024, citing sustained growth trends. While traditionally attracting investors from European markets like the UK, France, Germany, and the Netherlands, as well as from China and other parts of Asia, Portugal is witnessing a surge of interest from new regions such as Brazil, the United States, Canada, and the Middle East. 

However, navigating the Portuguese mortgage system requires insight. In this article, we delve into the essential steps and considerations for obtaining a house mortgage in Portugal. Our aim is to provide invaluable guidance for a smooth transition to homeownership in one of Europe’s most sought-after destinations. Follow along! 

Understanding Portugal’s Real Estate Market

In the third quarter of 2023, Portugal’s residential mortgage lending surpassed an impressive 100.6 billion euros. This milestone highlights Portugal’s growing prominence in the European real estate market. 

A report by Forbes further highlights Portugal’s appeal, revealing that its property market remains notably more affordable than that of the United States. With a median listing price per square foot of $154 in Portugal, it is 30% less expensive than the $221 observed in the US. This explains why hundreds of American expats move to Portugal every year! 

For expats seeking rental accommodations, Portugal emerges as an attractive destination, offering both accessibility and diversity. In December 2023, the average cost per square meter stood at a reasonable 15.5 euros. Notably, the Lisbon metropolitan region led the pack with rentals surpassing 18 euros per square meter, while the North followed closely behind at an average of 13.7 euros.

For expats seeking budget-friendly options, the Azores emerged as the most economical choice, with rental prices as low as 8.9 euros per square meter. Whether you’re aiming for city sophistication, northern charm, or island tranquility, Portugal offers a range of rental opportunities to suit every preference and budget.

Real estate in Portugal overall offers a much better deal than you could get in most European nations, or even the US and UK. 

Recently, the Portuguese cabinet approved a 30% reduction in mortgage rates for struggling borrowers. This subsidy, effective until year-end with potential renewal, underscores Portugal’s welcoming stance. But how easy is it for an expat to qualify for a mortgage in Portugal? Do you need a mortgage broker and how do you find one that’s qualified? 

Let’s dive into some more details!

Availability of Housing For Expats

With bustling city life, historic charm, and serene retreats, Portugal emerges as an ideal destination for expats seeking their perfect home and mortgage in Portugal. 

In Lisbon, the capital’s historic charm intertwines with modern amenities, while Porto’s UNESCO-classified center and outskirts provide tranquility at lower costs. 

Braga, with its ancient churches and modern properties, appeals to those seeking heritage and affordability. Aveiro, known as the “Venice of Portugal,” offers a serene lifestyle with picturesque canals and Nouveau architecture. 


Furthermore, expats will also find diverse housing preferences across regions. The Algarve attracts foreign investors with demand for second homes, focusing on one-story villas. While Porto sees a high demand for villa properties. In Lisbon, small flats are sought after. 

In recent years, the availability of housing for expats has seen many challenges due to the limited supply and increasing demand. 

Understanding Mortgages in Portugal

Unlike familiar UK or US lending practices, mortgages in Portugal have distinct conditions for residents and non-residents. Non-residents typically face loan-to-value ratios (LTV) between 65% and 75%, requiring a minimum deposit of 30% of the property’s purchase price. 

Portuguese banks rarely offer 100% financing, with most citizens needing a 20% down payment. While banks might extend financing up to 90%, buyers aim for properties appraised higher than the purchase price to secure favorable terms. 

Seeking professional advice can help navigate these intricacies, ensuring a smooth investment process in Portugal. For expats, getting a mortgage in Portugal through qualified experts is usually the only way to go about it, given the bureaucracy. 

Types of Mortgages Available

For expats, mortgage in Portugal comes in two main types: variable-rate and fixed-rate. With a variable-rate mortgage, your interest rate can change over time based on the Euribor rate. Fixed-rate mortgages keep your interest rate steady for a set period, offering stability but possibly at a higher cost. 

Most mortgages here require you to repay the borrowed amount and interest monthly. They typically last 25 years, but some lenders may offer up to 30 years. You’ll usually need to repay the mortgage by age 70, 75, or 80. Understanding these basics is key for expats navigating Portugal’s mortgage options.

Furthermore, expats can also access buy-to-rent mortgages and commercial mortgages. Buy-to-rent mortgages often require a larger deposit, up to 40% of the property’s value, and proof of income to cover mortgage payments. Commercial mortgages typically need a deposit of at least 50% and details about the business, including a business plan for new ventures.

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Interest Rates and Terms

Mortgage rates in Portugal can range from 1% to 8%, depending on factors like property value, deposit size, financial history, and the type of mortgage chosen. Variable-rate mortgages are common, tied to the Euribor rate plus a fixed percentage. 

Euribor rates come in five types, including one-month, three-month, and six-month rates. For instance, if the Euribor rate is 1% and the mortgage adds 2%, the borrower’s interest rate would be 3%. Understanding these factors helps borrowers choose the right mortgage option in Portugal.

According to Trading Economics, the Bank Lending Rate in Portugal rose to 5.90 percent in January from 5.87 percent in December 2023. On average, the Bank Lending Rate in Portugal has been around 4.99 percent from 2003 to 2024. The highest rate recorded was 8.08 percent in October 2008, while the lowest was 1.63 percent in May 2020.

Preparing for Mortgage Application

To secure a mortgage in Portugal, ensure your credit score is solid and your income steady. Kickstart the process by seeking an assessment from a mortgage broker and submitting the required documents. This includes property valuation and finalizing at a notary. 

Foreigners must provide essential documents such as a Passport copy, Portuguese tax number (NIF), proof of income, bank statements, and address verification for a smooth mortgage application process.

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Assessing Your Financial Situation 

When applying for a mortgage in Portugal, each bank has its own criteria based on your finances and the property’s value. Your financial situation is evaluated by considering your current earnings, existing debts, employment history, and credit history. 

Generally, individuals with good credit scores and stable incomes can qualify for mortgages. Secure employment or retirement income enhances your approval chances, and self-employed individuals can also apply.

How much can you borrow in Portugal?

For expats, Portugal offers favorable mortgage options, with non-residents typically qualifying for loans up to 65-75% of the home’s value or sale price. On the other hand, Fiscal residents can secure loans up to 90% of the sale price. While individual circumstances may affect loan amounts, expats might need a larger deposit. 

For instance, purchasing a 200,000 euro home could entail receiving around 130,000 euros from the bank as a non-resident, necessitating a down payment of 70,000 euros. However, additional costs like taxes should also be factored into the home-buying process.

Mortgage Brokers in Portugal

Onto the best part of the article! 

Finding a qualified mortgage broker in Portugal is tough. But our team here at Viv Europe focuses extensively on making your relocation as simple as possible. 

Spreadhunters are a team of qualified mortgage brokers who help expats make their dream of homeownership a reality. 

They have a success rate of 100% with a guarantee of a safe experience that matches your expectations. With Spreadhunters, you can book a consultation with their team, conduct a financial simulation, and start your process to get a mortgage in Portugal. 

Partnered with some of the best banks in Portugal, their team offers transparency and reasonable mortgage rates to make your homeownership process seamless! Their team of Hunters is committed to accompanying you step by step until your deed is finalized.

To understand the process or apply for a mortgage in Portugal, get in touch with their team and let them know where you found them! You’re one step closer to making your dream life come true! 

Do you need a mortgage broker in Portugal? 

This question can be divided into two parts. Are you buying a house with a 100% downpayment? Are you looking for a house on a mortgage? 

For the former, no, you wouldn’t require a mortgage broker, but a real estate agent who can help you acquire a property you like. For expats who are looking to get a house mortgage, it is extremely necessary that you work with a mortgage broker who knows what they’re doing. They can often get you the best rates possible and help you out the best. 

As an expat who doesn’t know the bureaucratic procedure and doesn’t know the language, you will require a mortgage broker without a doubt. 

Buying a property in Portugal

Buying a property in Portugal used to be one of the many ways to qualify for a Golden Visa. Unfortunately, it is not anymore, but you still have many options to guarantee a better quality of life. Investment funds are among the top ways to qualify for a Golden Visa as of 2024! 

Before you contact a real estate agent, make sure to do your own research and check your options. Start by making a list of what you want and what areas you’d like to explore. 

Once you get in touch with a professional, leave it up to them to find you the best property in Portugal that suits your needs! 

buying-a-house-in-Portugal-on-mortgage

Do you need help getting a mortgage in Portugal? 

Say goodbye to all the hassle that comes with getting a mortgage in Portugal. With Spreadhunters and Viv Europe, homeownership as an expat is closer than before! 

Feel free to book a consultation with Viv Europe to understand the process better. Our team of professionals deals with everything from Visa assistance to post-relocation services and more. 

Do you have questions or concerns? Join our Facebook Group – All About Portugal For Expats and post them there! You’ll find many expats who share the same story as you – get ready to be inspired and start your process now! 

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