Frequently asked questions
The hard questions, answered before you call me.
Taxes, mortgages, promissory contracts, short lets, paperwork. If your question is not here, ask it — I will answer it just the same.
Questions and answers
Showing 40 questions.
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The promissory contract of purchase and sale (CPCV) is the legal document binding buyer and seller ahead of completion. It secures the property and sets the deposit — normally between 10% and 20% — and provides for compensation should either party default.
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Beyond the price of the property, you should budget for IMT (property transfer tax), Stamp Duty (0.8%), completion costs, land registry fees and solicitor's or lawyer's fees. These charges generally add between 5% and 8% to the final figure.
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Yes, there are no nationality restrictions on acquiring property. The only essential requirements are obtaining a Portuguese tax number (NIF) and opening a bank account in Portugal.
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Buyers up to the age of 35 acquiring their first permanent home may benefit from full or partial exemption from IMT and Stamp Duty, subject to property-value limits set by law, along with the possibility of 100% financing under a state guarantee.
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A cash purchase can take between 2 and 4 weeks. Where a mortgage is involved the process averages 45 to 90 days, depending on how quickly the bank approves it and values the property.
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Banks in Portugal lend at most 80% to 90% of the purchase price or the valuation — whichever is lower — for a permanent home. You need at least 10% to 20% of the property value, plus the taxes and transaction costs.
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The sale price is what buyer and seller agree. The bank valuation is the figure estimated by an independent surveyor instructed by the bank. The amount lent is always calculated on the lower of the two.
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It is the share of the household's net monthly income going towards credit repayments. Banks generally require that it does not exceed 33% to 35%.
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A variable rate moves with Euribor. A fixed rate guarantees the same payment for the whole term. A mixed rate, much in demand today, combines an initial fixed period — 2, 5 or 10 years — with a variable rate thereafter, giving stability in the short and medium term.
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The rise in value comes from strong international demand, the scarcity of building land given the island's terrain, the high level of safety, the mild climate all year round and the quality of life.
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For residence and services, Funchal — particularly São Martinho and Ajuda — is the most sought-after area. For warm weather and investment in short lets or a second home, Calheta and Ponta do Sol stand out. Caniço and Santa Cruz offer excellent value for money a few minutes from Funchal.
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Madeira has a number of microclimates. Properties below 200 metres in altitude are warmer and sunnier. Solar aspect — south or north — and humidity levels vary considerably from parish to parish and with elevation.
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It can be worthwhile, but it calls for care over the municipal local plan (PDM), the gradient of the site — which drives excavation and retaining-wall costs — and access to the plot. Confirming that building is permitted with the relevant town hall before signing the promissory contract is essential.
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Yes. Given the topography and the narrow streets in many parts of the island, properties with a private garage or covered parking are worth substantially more and are easier to resell or let.
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Unlike the restricted zones on the mainland, the Autonomous Region of Madeira retains its own authority over short-let legislation. Some central areas of Funchal have specific rules, but there is still scope for new licences in municipalities with strong tourism potential.
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Gross yields on long-term lets sit between 5% and 7%. On short lets, in areas of high tourist demand, the return can be higher — with management, cleaning and maintenance costs to be deducted.
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Income from rents on property in Portugal received by non-residents is taxed at a flat income-tax rate, currently 25% to 28%, with maintenance, service-charge and council-tax costs deductible.
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The local market has quirks of documentation, old municipal licences and geographical specifics that a layperson will not know. A local agent has access to the off-market — properties never published on the portals — qualifies genuine buyers and manages the process from start to finish with legal certainty.
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In Portugal the agency commission is normally borne by the owner of the property. The guidance, the search and the advice given to the buyer are not an added cost to them.
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You should satisfy yourself as to the Land Registry certificate, the tax register entry (Caderneta Predial Urbana), the use licence — or proof of exemption, for buildings predating 1951 — the Energy Certificate and the Housing Technical Sheet, the latter for properties built after 2004.
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Personal attention backed by the scale of KW Alfa, the largest agency network in the market. I combine knowledge of the Madeira market, digital marketing strategy, legal rigour throughout the paperwork and negotiating skill focused on defending the real value of your asset.
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It is the formal agreement authorising me to market your property. It can be on a sole-agency basis — only one agent markets it, which guarantees full focus and greater marketing investment — or on an open basis, with several agencies marketing it at once.
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Sole agency gives you one accountable point of contact, a bespoke marketing plan, regular activity reports and the sharing of your property with every agency in the market on a 50/50 basis — increasing exposure without creating confusion over prices online.
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Through a Comparative Market Analysis, in which I cross-reference data on similar properties recently sold in the same part of Madeira, the competing stock currently on the market and the real demand recorded in the Keller Williams database.
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The principle here is home staging: depersonalise the rooms — remove photographs and personal objects — tidy up, maximise natural light and give the place a deep clean. Well-presented spaces attract higher offers.
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Listing involves no upfront cost to the owner. The agency commission only falls due once the sale completes, and is normally paid at the promissory contract or at completion.
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The marketing plan covers publication on national and international portals (Idealista, Casa SAPO, Kyero, Green-Acres), targeted social media (Meta and Google Ads), the global Keller Williams internal network and local marketing on the island.
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At KW Alfa Madeira we share the commission equally with any agent or agency holding a valid AMI licence who brings a qualified buyer — multiplying the chances of a quick sale.
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Before arranging a viewing, I assess the prospective buyer financially and on their motivation, to make sure they can genuinely proceed. It protects the owner's privacy and safety.
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Yes. I provide regular performance reports with portal view metrics, the number of enquiries received, detailed feedback from viewings held and analysis of the direct competition.
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Every offer is presented formally in writing, together with the buyer's financial validation. I set out the pros and cons of each one — price, timescales, conditions — and support the owner in deciding or countering.
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The draft promissory contract of purchase and sale is prepared, the property's up-to-date paperwork is validated, the deposit is fixed and the date for formal signature is set.
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The seller is responsible for capital gains tax, where it applies and where the proceeds are not reinvested in a permanent home, for the discharge of any outstanding mortgage, and for the agency fees.
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The seller's bank is asked to issue the mortgage discharge. On the day of completion the buyer's bank — or the buyer directly — issues a banker's draft to the seller's bank to settle the outstanding debt, and the discharge is issued.
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- Setting a budget and obtaining mortgage pre-approval.
- Selecting and viewing properties.
- Presenting and negotiating the offer.
- Signing the promissory contract and paying the deposit.
- Issue of the mortgage discharge and the bank valuation.
- Completion before a notary.
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You should confirm that all the paperwork is in order, establish whether any charges or encumbrances are registered against the property, check the use licence and satisfy yourself that any rights of pre-emption have been exercised or have lapsed.
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Yes, but with legal penalties: if the buyer withdraws, they forfeit the whole deposit paid; if the seller withdraws, they must return twice the deposit, unless the contract provides otherwise.
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- Land Registry certificate, up to date.
- Tax register entry (Caderneta Predial Urbana), issued by the tax authority.
- Use licence, or a certificate of construction predating 1951.
- Energy Certificate.
- Housing Technical Sheet, for properties built after 2004.
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It is a document issued by the building's managing agent confirming that the property owes nothing — service charges and reserve fund. Since 2022 it has been required by law at completion, to protect the buyer from inheriting the former owner's debts. The buyer may, however, expressly waive it at completion and take on the debt.
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It is the legal right given to certain public bodies — town halls, the State, the heritage authority — or to private parties — tenants of more than two years, co-owners — to acquire the property on the same terms and price agreed with a third party. It is published on the Casa Pronta portal before completion, for a statutory period, normally 10 working days.
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