What are closing costs in Portugal?

Typically 9.7–10.7% of the price on a $300,000 purchase.

Buying property in Portugal as an American

Q: How is rental income taxed in Portugal?

Non-resident rental income tax: Non-residents pay a flat 25% on long-term rental income after deductible expenses (IMI, condo fees, maintenance; not mortgage interest or depreciation). Short-term (AL) income follows different rules, and a 10% rate exists for moderate-rent leases from 2026. US–Portugal tax treaty in force; Portuguese tax paid is generally creditable against US tax on the same income.

Portugal lets Americans buy freely and has a mature rental market. Prices in Lisbon and Porto have risen fast, so yields are moderate, and short-term rental licences are restricted in several city districts.

Data last verified on October 19, 2026 · AbroadYield research desk – public sources cited in each section

Key numbers

Gross rental yield

4.0–6.5%

Closing costs

9.7–10.7%

On a $300,000 purchase

Tax on rent (net basis)

25%

Non-resident rental income tax

Entry prices from

$180,000

8–12 weeks to close

Can Americans buy?

Allowed

No restrictions on US buyers. Purchases are completed by public deed before a notary.

Buying property no longer qualifies for the Golden Visa. The D7 (passive income) visa is a common route for retirees; owning a home helps but is not required.

Data last verified on October 19, 2026 · AbroadYield research desk – public sources cited in each section

Sources: Portal das Finanças (Portugal tax authority); US Department of State – country information

How rent is taxed

Non-residents pay a flat 25% on long-term rental income after deductible expenses (IMI, condo fees, maintenance; not mortgage interest or depreciation). Short-term (AL) income follows different rules, and a 10% rate exists for moderate-rent leases from 2026.

US–Portugal tax treaty in force; Portuguese tax paid is generally creditable against US tax on the same income.

As a US taxpayer you also report the rent on Schedule E. Your free ranking estimates the combined effect for your state and income.

Data last verified on October 19, 2026 · AbroadYield research desk – public sources cited in each section

Sources: Portal das Finanças (Portugal tax authority); PwC Worldwide Tax Summaries; IRS – United States income tax treaties

Main risk

New short-term rental licences are suspended in parts of Lisbon and Porto.

Short-term rentals require an Alojamento Local (AL) licence; municipalities can suspend new licences in high-pressure districts.

Data last verified on October 19, 2026 · AbroadYield research desk – public sources cited in each section

Sources: US Department of State – country information; Global Property Guide (yields, transaction costs)

Cities we cover

Lisbon$7,000/m² · gross 4.7%
Porto$4,816/m² · gross 5.0%
Faro & Algarve$4,480/m² · gross 4.4%
Braga$2,688/m² · gross 5.3%
Funchal (Madeira)$4,536/m² · gross 4.9%

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