Updated: June 7, 2024


algarve portugal land for sale

Is owning a private escape in the sun-kissed paradise of Algarve, Portugal, your dream? If so, you’ll be glad to know that buying property in Algarve, Portugal, is a possibility and a smart investment. There are no restrictions on foreigners buying property in Portugal, plus, property investment in the sought-after coastal Algarve region is likely to yield exceptional returns.

This famous coastal region in Southern Portugal borders Spain and offers residents and tourists a world-class coastal lifestyle and affordable living costs. It makes the perfect destination for extended holidays or relocation due to the allure of a slow-paced lifestyle enveloped by stunning beaches and a fantastic climate.

The Algarve region features diverse lifestyle offerings. These include world-class golf courses like Monte Rei, an array of traditional dining options and top-tier restaurants, and many outdoor activities near the marina and coastline.

This comprehensive guide will give you an insider’s view of life in the Algarve and offer vital insights into the essential steps of acquiring real estate there – from understanding your budget and exploring preferred areas to enlisting trusted professionals to help you with your purchase.

We will also explore the value of working with a buyer’s agent in finding the perfect Algarve property, such as their expertise in the local market, which comes with skills including negotiating fair prices, handling paperwork, and ensuring a smooth transaction process. Let’s begin turning your Algarve property dream and investment prospects into a reality.

Why buy property in the Algarve, Portugal?

Whether you are looking for a holiday apartment, investing in a secure villa, or simply seeking an investment property with proximity to the city and sea, the Algarve region offers a variety of property options.

The blend of rich history and culture, seamless international tourist accessibility through Faro airport, and a variety of property prices and types to choose from create the perfect environment for a successful property purchase with considerable returns, whether you’re looking in the administrative capital of Faro or the scenic coastline of Praia da Rocha in Portimão.

Can foreigners buy property in the Algarve region?

There are no restrictions on foreigners buying a property in Portugal.

house in portugalPurchasing an Algarve property is also relatively easy if you have the proper support and assistance guiding you every step of the way.

The assistance of a local real estate professional or buyer’s agent is not a strict requirement. However, their services will prove invaluable in the long run. Of course, if you purchase a property to live permanently in Portugal, you must also secure a valid visa.

Some non-EU citizens’ most popular visa options include:

The Algarve Real Estate Market: An Overview

The properties in the Algarve offer a unique selection of property types to invest in. From a modern apartment in the city and a cozy villa near the beach overlooking the Atlantic Ocean to a quaint townhouse in the country, there are many options available for sale and rent in the beautiful coastal region that you can explore before settling on the perfect property.

Key reasons to buy property in the Algarve

algarve beachAttracted by the perfect weather, the coastline, delicious cuisine, and the high quality of life, you will find many expats from the UK, USA, and other countries across Europe and the globe living in the Algarve and buying properties in this stunning region of Portugal. Expats, property investors, and digital nomads looking for a rental property are attracted to the beautiful beaches, excellent golf courses, and relaxed atmosphere of the Algarve.

Retirees looking for an attractive destination as their retirement haven or a place to invest in a holiday home will find a great selection of properties in the Algarve, especially with the help of buyers or real estate agents. What makes the Algarve even more of an ideal destination to buy property is the area’s proximity to the Portuguese capital of Lisbon and accessibility through the Faro Airport.

Besides safety and quality of life in a multicultural coastal region, an additional reason for buying property in the Algarve is excellent returns on property investment through the tourism sector or rental income. Across the area, you’ll find the possibility for strong returns on investment opportunities.

Property prices in the Algarve

In addition to location and amenities, the price of the property on sale is one of the most crucial factors to consider. Property buyers interested in buying property in the Algarve to list as a rental property and earn rental income will be pleased to know that in the third trimester of 2023, the habitation yields in the Algarve stood at 5.6 percent. In the table below, we have provided a comprehensive overview of the average property price per square meter in different locations across Algarve, Portugal, in 2023.


Apartment Average Asking Price (€/sqm)

House Average Asking Price (€/sqm)




  Castro Marim
























  São Brás de Alportel









  Vila Real de Santo António



Where to buy property in the Algarve?

The Algarve offers diverse opportunities for property investment. Here, we will explore some of the region’s prime destinations, providing prospective Algarve property buyers with a blend of history, scenic beauty, and thriving communities.


Nestled along Portugal’s Eastern Algarve coast, Tavira offers visitors and residents a calm coastal region lifestyle and authentic Portuguese cultural richness. With stunning views of the Gilão River and some of the Algarve’s best beaches, like Praia de Tavira, Tavira is a charming  town with a mix of history, modern amenities, delectable cuisines, and a welcoming ambiance, making it a prime destination for investing in apartments, villas and other properties available for sale in the city. A real estate agent in Tavira can quickly help you find your dream home.


Thanks to its historic charm, bustling marina, and being situated close to numerous stunning beaches that make it one of Southern Portugal’s sought-after destinations, Portimão is an ideal spot for property investment. The area offers warm weather and affordable living and attracts expats and digital nomads with its welcoming community of locals and overall beauty.


Albufeira, located on the coast in the southern Algarve, is a holiday hub. What was once a quaint fishing village is now a sought-after destination offering sandy beaches, a vibrant nightlife, and iconic views of the striking limestone cliffs and captivating rock formations the region is known for. Albufeira’s rich history and Moorish-influenced architecture make it one of the best Algarve cities for property investment, especially if you are interested in earning capital from the tourism sector.


With a rich maritime history and breathtaking coastal vistas, Lagos is a top choice for property investment, appealing to diverse lifestyles, from a relocating family seeking a vibrant community to retirees in search of beauty and tranquility for their retirement. One of the most charming towns in the Algarve, Lagos is captivating with its historic walled old town offering apartments and villas to take in stunning views of cliffs and pristine Atlantic beaches.


Faro, the Algarve region’s capital, attracts expats, making it the second most expat-populated city after Lisbon, totaling 15 percent of Portugal’s expat community. This demand creates an investor’s haven, fostering high accommodation demand. Renowned for its rich history throughout the town’s cobbled streets and cultural allure, Faro offers diverse tourist attractions, making it an enticing prospect for property investors seeking a blend of cultural richness and thriving demand.

How to Buy Property in Algarve: A Step-by-Step Guide

Now that you know the price of a property in the Algarve and which towns to look at for properties, we have created a concise step-by-step guide for buyers outlining the purchase process and legal requirements for buyers.



Step 1: Secure financing for your property

Assess your finances, explore mortgage options from Portuguese banks, and understand associated costs such as taxes, legal fees, and property registration expenses.

Step 2: Find the perfect property

Set a budget and research the Portuguese real estate market, focusing on location, amenities, and rental potential. Seek guidance from real estate professionals like buyer's agents or real estate agents.

Step 3: Make an offer

Once you find a suitable property, negotiate an offer with the seller, potentially facilitated by a real estate professional. Consider having a buyer's agent representing your best interests during negotiations.

Step 4: Reservation Agreement and CPCV

After an offer is accepted, a Reservation Agreement may require a refundable fee. The Promissory Contract (CPCV) finalizes the promise of acquiring real estate between the two parties and includes a deposit to secure the transaction. We recommend that the signing of the CPCV is officially recognized and conducted in front of a Notary. 

Step 5: Signing the Escritura

The Escritura, or Final Deed, officially transfers property ownership. Signed before a Notary, it involves paying remaining balances and fees. After signing, the buyer becomes the official owner, concluding the process.

Requirements for a Successful Property Purchase

An essential part of buying real estate in the Algarve and Portugal is applying for a Portuguese NIF number and opening a bank account. These two requirements will also come in handy for any other transactions you must complete in the country, especially if you’re from outside Europe.

Portuguese tax number

You will need a NIF, the Portuguese tax number, to open a bank account in Portugal. You can apply for the NIF number at your local tax office or get an attorney to assist you. If you are a non-EU citizen, you must have a fiscal representative.

Portuguese bank account

When buying property in the Algarve, it is recommended to open a Portuguese bank account to avoid transaction fees when making your purchase. There are a variety of Portuguese banks to consider, many of which offer mortgages for foreign buyers.


Explore our comprehensive guide to buying property in Portugal

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Required Documents for Buying Property in the Algarve

Once you start the purchase process, it is vital to have all the essential documents ready to ensure the property purchase journey is seamless and legally compliant with Portuguese real estate law. Working with an Algarve real estate lawyer will prove invaluable as they can assist you with getting the documents you need in order and completing due diligence checks on the property on your behalf.

To purchase property in the Algarve, you will need the following documents: 

  • Photo ID: A valid identification document that verifies your identity.
  • Contrato Promessa de Compra e Venda (CPCV): The buying contract or property deed that outlines the terms and conditions of the property purchase.
  • Energy Certificate: This document provides information about the property’s energy efficiency and must be presented to you by the seller. Read our guide, Portugal’s Energy Performance Certificate Explained, to learn more.
  • Imposto de Selo: The stamp duty payment is a tax required by the Tax Authority for property transactions.
  • Caderneta Predial: The land register document contains information about the property, including its location, boundaries, and registered owner.

Buying Property in the Algarve, Portugal: Pitfalls, Advantages, and Disadvantages

It’s essential to consider the potential pitfalls when buying property in the Algarve. During the process, you could encounter legal complexities with property title deeds or debts attached to the property that could lead to lengthy legal battles.

Pitfalls of buying property in the Algarve

Besides the purchase price, you must account for additional expenses beyond the property’s listed price, such as mortgage costs for foreign buyers, property taxes, notary fees, legal fees, and registration expenses. Overlooking local regulations or tax laws could lead to fines or unexpected financial obligations.

Lastly, the location of the potential property is a crucial aspect to consider. Unforeseen issues, such as zoning changes or environmental concerns, can affect property values or intended use. It would help if you also were sure to learn and understand the ebb and flow of the location you’re investing in. Get a feel for both high-volume vacation seasons and off seasons like winter when life slows down, and access to local entertainment and amenities may be limited.

Seeking the professional services of a buyer’s agent or experienced local real estate agent will help you understand the intricacies of property acquisition in Portugal, navigate setbacks successfully, and save you from potential roadblocks.

Advantages of buying property in the Algarve

algarve real estateThe Algarve is a beautiful location to move to, with many expats embracing a high quality yet affordable lifestyle. Below, we;ve outlined some of the key advantages of buying property in the Algarve.

  • Stunning coastline: The key selling point of the Algarve is that the region is simply spectacular, with beautiful beaches, stunning landforms, and quaint towns that embrace the local way of life.
  • Climate: With more than 300 days of sunshine each year, the climate allows you to live a very active life, where it’s possible to enjoy the great outdoors throughout the year.
  • Investment potential: Property in the Algarve is a good investment due to its popularity among tourists and expats, offering opportunities for rental income or resale value appreciation. Average rental property yields in the Algarve stand at 5.6 percent.
  • English is widely spoken: English is widely spoken in the Algarve, in restaurants, healthcare centers, and shops. You should have no difficulties with speaking with locals.
  • Education opportunities: There are 12 international schools in the Algarve, offering a wide range of teaching styles, languages, and curricula.
  • Exellent healthcare options: You’ll find three hospitals in the Algarve and a wide range of private healthcare options. Healthcare in the Algarve is generally excellent and English is widely spoken.

Disadvantages of buying proeprty in the Algarve

As with buying propety in any country or region, the Algarve has its disadvantages, which you will finds below.

  • Tourist hotspot: Given the beauty of the Algarve, it is a major tourism destination, which can lead to overcrowding during peak seasons.
  • Potential overdevelopment: There’s a risk of overdevelopment in some areas, leading to environmental concerns and loss of the region’s natural charm.
  • Public transportation: While public transportation is usually very good, with an extensive train service and local bus routes, it is worth getting a car to get to the more secluded spots.
  • Bureaucracy: Bureaucracy can be slow in Portugal. To make the process as fast as possible, ensure that you have all correct documents with you.

Financing Your Property in Portugal

Once you have decided on the perfect location and property for your investment in Algarve real estate, you can begin planning how to finance your purchase. This section looks at how you can prepare your budget and Portugal’s financing options for buying a dream home.

Get your budget straight

Creating a clear budget that considers the various costs, from initial application fees to property taxes, is crucial. If you need to finance your purchase, also bear in mind that mortgage deposits usually range between 10 percent and 20 percent for Portuguese residents. In comparison, non-residents typically require around 30 percent of the property value as a deposit.

Secure financing for your property: Main options

If you have capital, one-off payments on your property purchase price will be possible. However, a great selection of mortgage options is available from financial service providers, including BBVA, Santander, Banco Best, Bankinter, and Banco CTT.

Mortgages in Algarve, Portugal

Getting a mortgage in Portugal involves approaching banks or mortgage agents for an initial estimate. While residents enjoy broader borrowing options, non-residents face different criteria. Typically, non-residents should budget for a 30 percent deposit and consider factors like the Loan-to-Value (LTV) ratio, which usually hovers around 70 percent. Fixed-rate mortgages, lasting between 3 and 30 years, currently stand at approximately 3.9 percent for up to five years.

Types of Mortgages

Fixed-rate mortgages come with a premium but offer stability, protecting against rate changes. However, non-residents face a capped LTV ratio of 75 percent. Variable-rate mortgages, tied to the Euribor, provide fluctuating rates; currently, mortgage spreads sit around 0.85 percent. Monthly payments fluctuate over time, and early repayments might incur a 0.5 percent charge on the repaid capital.

Cost and Fees for Mortgages in Portugal

property tax gains portugalAside from application and valuation fees, significant costs are involved in securing a mortgage in Portugal. Notary, registry, and tax office fees for mortgage deeds, along with Stamp Duty Tax (IMI) at 0.8 percent of the property price, add to the financial considerations. The Property Purchase Tax (IMT) varies from 2 percent to 8 percent of the property price.

Navigating the mortgage landscape in Portugal demands a clear understanding of available options, associated costs, and varying requirements for residents and non-residents. A buyer’s agent like Goldcrest will be able to offer assistance and personalized experience like connecting you to prospective mortgage brokers based on your criteria. This will ensure a smoother path towards property ownership in this vibrant European destination.

A Guide to Portuguese Property Taxes

Navigating Portugal’s property purchasing process entails much more than the excitement of finding your dream home. Here, we briefly explain the applicable Portuguese property taxes you will have to pay for property acquisition and ownership in Portugal.

Municipal Property Tax (IMI)

The IMI (Municipal Property Tax) is an annual tax, the amount of which is determined by the municipality where the property is located. The rates range from 0.3 to 0.8 percent based on the property type and location.

Property Purchase Tax (IMT)

Calculated based on the property’s value or declared amount in the deed, the IMT (Municipal Tax on Onerous Transmissions of Real Estate) is a property transfer tax that needs to be paid before the purchase is completed. The property transfer tax rate varies from 0 to 8 percent based on property type, location, purchase price, and intended use. Our Portugal property tax calculator can help calculate your potential property’s IMT.

Stamp Duty

The Stamp Duty (Imposto do Selo) is an additional transaction tax the Portuguese state charges for real estate transfers. It amounts to 0.8 percent of the deed’s total value and must be paid at the time of purchase.

AIMI (Wealth Tax)

The Portuguese Wealth Tax (AIMI) is a post-purchase tax that applies to property worth more than €600,000. There are three levels of taxation based on property value:

  • 0.7 percent tax for properties valued between €600,000 and €1 million
  • 1 percent tax for properties valued between €1 million and €2 million
  • 1.5 percent tax applied to property worth more than €2 million

Capital Gains Tax

Capital gains refers to the profit from the property’s sale that may be subject to taxation. When you sell your Portuguese property, you must submit the property’s purchase details to the tax authorities for a capital gains assessment. You may be exempt from capital gains tax if you reinvest the total selling price in a new home. Our article, Property Taxes in Portugal 2024: An Overview, is a comprehensive guide to property tax in Portugal that you may find beneficial.

Property Purchase Costs

When purchasing property in Algarve, Portugal, it’s crucial to factor in the various one-off costs essential for the transaction. These include notary and registration fees, attorney fees, transfer tax (IMT), stamp duty fees, and expenses related to the land registry. Additionally, there might be fees associated with lawyers, especially if legal counsel is sought during the property acquisition process.

Is it worth buying property in Portugal?

Algarve-PortimaoThere are many good reasons to buy property in the Algarve, Portugal. Some of these key advantages include:

  • No restrictions on foreign property ownership
  • Investing in a dynamic market with a high return on investment potential  
  • Low cost of living compared with other countries in Western Europe  
  • Fantastic climate with incredible summers and mild winters  
  • Top-quality education and healthcare services  

Consider these benefits and consider the potential pitfalls you may encounter during the process, which we explored above, to decide if the Algarve is the right place for you and offers the right investment market for you.

Goldcrest: Our Expertise Can Help You Find Your Dream Property

Goldcrest is a buyer’s agent based in Lisbon, Porto, and the Algarve. Equipped with local knowledge, exclusive networks, and international experience, we provide expert, impartial advice on real estate investments and how to buy property in the Algarve, Portugal. From scouting out the perfect property to property acquisition, we have you covered throughout the process. Our team of skilled experts can cater to all your real estate needs, offering insightful expertise and strategic advice. Book a complimentary call with us today.

Frequently Asked Questions about Buying Property in Algarve

Working with a real estate lawyer is a flexible requirement for purchasing property in the Algarve. However, securing the assistance of professional legal services is recommended for a seamless and compliant purchase process.

There are no restrictions when it comes to buying a property in Algarve as a foreigner. For a successful purchase, the assistance of a local real estate professional or buyer’s agent is not a strict requirement, but their services will prove invaluable in the long run.

Aside from the property’s asking price, there are essential costs to factor in when buying a house in Algarve Portugal. These include costs like notary and registration fees, legal fees, transfer tax (IMT), stamp duty fees, and potential expenses related to the land registry.

The deposit for the property usually lies between 10 to 25 percent of property prices based on the condition that the mortgage offer is accepted. However, to be safe, non-residents and foreign buyers should budget 30 percent of the property purchase price for the deposit.

Property in the beautiful Algarve region is quite affordable. An apartment in the Algarve capital, Faro, will cost €3,519 per square meter according to data from the Confidencial Imobiliário.

Besides safety and quality of life in the Algarve, buying property here offers excellent returns on property investment through the vibrant tourism sector or rental income.

You will find substantial communities of English-speaking expats living in the Algarvian cities of Tavira, Vilamoura, Lagos, Faro, Albufeira, Alvor, and Ferragudo.

Start looking for beachfront properties by visiting online listing websites.Once you have an idea of what you are looking for and the location you are looking in, you can contact a real estate agent or buyer’s agent for assistance with the process.

A buyer’s agent like Goldcrest will also be of great value as they will have access to exclusive listings through their network and solely work on your behalf as the buyer.

You could encounter several potential pitfalls when buying property in the Algarve, which is why seeking the professional services of a buyer’s agent is highly recommended. Possible issues may include:

  • Legal complexities with property title deeds or debts attached to the property.
  • Overlooking local regulations or tax laws could lead to fines or unexpected financial obligations.
  • Unforeseen issues related to location include zoning changes, environmental concerns, or limited access to local entertainment and amenities.

Calculated based on the property’s value or declared amount in the deed, the IMT (Municipal Tax on Onerous Transmissions of Real Estate) is a property transfer tax that needs to be paid before the purchase is completed. The property transfer tax rate varies from 0 to 8 percent based on property type, location, purchase price, and intended use.

Yes, buying property in the Algarve can be a good investment due to its stable market, scenic beauty, and potential for rental income. The average rental yield for the Algarve region stands at 5.6 percent.

Foreigners can freely purchase property in the Algarve, but it’s crucial to adhere to legal requirements. You will need to obtain a Portuguese fiscal number (NIF), and if you are a non-EU citizen, you will need to appoint a fiscal representative. We also highly recommend that you open a Portugeuse bank account. Working with a reputable real estate professional and a lawyer who understands local regulations is advisable to ensure a smooth property transaction.

There are various ways to find properties for sale in the Algarve. You can start by browsing real estate websites specializing in the region. However, online research can only get you so far, and it’s best to work with experienced professionals who have extensive knowledge of the area and can provide access to exclusive listings and valuable insights into the market. A buyer’s agent is often better than a real estate agent in Portugal as they work on behalf of the buyer and will ensure that your interests are protected, providing you with investment insights on the local market tailored to your requirements.

The typical process for buying a house in the Algarve involves the following steps. First, you’ll need to find a property and negotiate the terms of sale with the seller. Once an agreement is reached, you’ll sign a promissory contract and pay a deposit. Then, both parties will proceed to complete due diligence, including property inspections and legal checks. Finally, the sale concludes with the signing of the final deed of sale at the notary’s office, where the remaining balance is paid and ownership is transferred. We highly recommend working with an experienced real estate professional who can provide you with local insights and share their expertise and a trusted real estate lawyer to ensure a smooth property purchase.

For property buyers looking to secure property in the Algarve, it’s essential to consider associated costs beyond the purchase price. These include property taxes, stamp duty, notary and registration fees, and legal fees.

The property buying process in the Algarve typically takes between one to four months to complete. However, property buyers will find that the timeline can vary based on factors such as property type, due diligence checks, financing arrangements, and any legal or administrative complications. Working with experienced professionals and staying organized throughout the process can help expedite the transaction.

The Algarve offers a diverse range of properties to suit different preferences and budgets. From luxurious beachfront villas and contemporary apartments to traditional townhouses and countryside estates, there’s something for everyone. Whether you’re seeking a primary residence, rental property, vacation home, or investment property, you’ll find a wide selection of options across the region’s vibrant real estate market.

The steps to buying property in the Algarve are the following. First, you need to find a property and negotiate the sale terms with the seller. After reaching an agreement, you will sign a promissory contract and pay a deposit. Both parties then carry out due diligence, which includes property inspections and legal checks. The sale is finalized with the signing of the final deed of sale at the notary’s office, where the remaining balance is paid and ownership is transferred. We highly recommend working with an experienced real estate agent or buyers agent for local insights and a trusted real estate lawyer to ensure a smooth property purchase.

Top areas to buy property in the Algarve include Albufeira for its vibrant nightlife, Lagos for its historic charm and sweeping ocean views, Vilamoura for its luxury properties, and Tavira for its picturesque scenery and tranquility.

There are no restrictions on foreigners buying property in Algarve, Portugal. Both EU and non-EU citizens can freely purchase property, though non-EU buyers will need a visa or residence permit to live in Portugal.

Financing a property purchase in the Algarve can be done through Portuguese banks offering mortgages to foreigners. There are more than fifteen banks in Portugal that provide mortgages to foreign buyers, including BCP Millennium, Bankinter, Santander, and Banco CTT.

When foreigners buy property, they need to be aware of the taxes payable both at the time of purchase and on an annual basis. During the purchase process, these include the Property Purchase Tax/Property Transfer Tax (IMT) and Stamp Duty. Annually, owners must pay the Municipal Property Tax (IMI). Additionally, if you plan to sell your property, you should consider the Capital Gains Tax.

To find reputable real estate agents in Algarve, seek recommendations, check online reviews, verify licenses with the Portuguese Real Estate Professionals and Brokers Association (APEMIP), and interview multiple agents. Remember that real estate agents work on behalf of the seller and will get a higher commission for a higher sale. Should you opt for a buyer’s agent, they work solely on behalf of the buyer, ensuring there is no conflict of interest and that your interests are protected.

Maintenance costs for property in Algarve include utilities, homeowners’ association fees, property management fees, and upkeep expenses like gardening, pool maintenance, and repairs. Costs vary based on property size and location, but you should be able to have a ballpoint figure of these expenses once you know which property you are thinking of buying.

While it is not yet very common, it is possible to buy a house in Portugal using cryptocurrencies. It’s important to consult with legal and financial advisors to ensure compliance with Portuguese regulations.

The Algarve property market is known for its strong demand, especially in coastal areas, offering higher investment returns compared to other Portuguese regions, but property prices can be higher due to its popularity and amenities.

To open a bank account in Portugal as a foreigner, you’ll need a Portuguese tax number (NIF), identification (passport), proof of address, and proof of income. Visit a local bank branch to apply.

Popular neighborhoods for foreigners in the Algarve include Quinta do Lago for luxury living, Carvoeiro for a village feel, and neighborhoods in Lagos for its blend of history and modern amenities.

To buy property in Portugal, you will need the following documents:

  • Photo ID
  • Buying contract, known as the Contrato Promessa de Compra e Venda (CPCV)
  • Energy Certificate
  • Stamp Duty
  • Caderneta Predia, the land register document

Foreign owners can manage their property in the Algarve by hiring local property management services. These services handle maintenance, rentals, bill payments, and legal compliance, ensuring the property is well-maintained. If you are looking for property management services, then Goldcrest would be more than happy to assist you.