What are the running costs of a house in Portugal?

(5min read)

Once you’ve decided where you want to buy property in Portugal and how much you can expect to pay based on average house prices there, you’ll also want to know about the running costs of upkeep and maintenance. It’s important to know what other expenses you’ll have to pay on your new Portuguese home after the initial purchase is made (apart from the obvious ones like water, gas, and electricity bills).

In this video, Portugal Homes’ Co-Founder and CEO, David Poston, elaborates on the costs of buying a home in Portugal. There are some government costs, Legal fees and if you choose to live overseas, fiscal representation services that companies like Portugal Homes can provide.

Property tax

• IMI Municipal Property Tax (Imposto Municipal Sobre Imóveis): This is a tax on homeowners in Portugal, but you don’t have to pay if it’s your main residence or if you rent it out on a long-term or permanent basis of at least 10 years. If you have to pay, you’ll receive a letter from the tax authority between January and April, as the tax is to be paid in two parts in April and September. If you don’t get anything, you may want to ask the tax office. It is calculated based on the value of the property, taking into account the market value, the location and the type of property. There are three categories:
  • Urban buildings (prédios urbanos): 0.7% - 1.3% of the fiscal value for town- or city-based homes.
  • Country buildings (prédios rusticos): 0.8% of the fiscal value for buildings in agricultural use or unbuilt land in the outskirts of cities.
  • Mixed buildings (prédios mistos): When used as a mixture of both these uses, it’s tax category falls in the middle.

Other expenses

• Home insurance: Just as with any other house, it’s a good idea to have home and contents insurance on your Portuguese property. In Portugal, the standard rate charged by insurance providers is from 180 to 380 euros a year, but that obviously varies with property type, location, and value.
• Home administrator: If all this red tape seems like too much work for you, especially in Portuguese, another option is to just hire a property manager to do the paperwork and organize the payments for you. These kinds of services cost about 100 to 150 euros per year, and allow you to sit back and relax in your home in the sun and not worry about the running costs!

Utility bills

The monthly cost of utilities in Portugal depends on how big your house is and how many people live there. For example, heating, electricity, and water for one person in a 45m2 studio can cost between €80 to €90 per month.

Utilities for two people in an 85m2 apartment can be between €120 and €130 per month.