Useful Area
The Useful Area refers to the interior perimeter of the property's walls. In simple terms, it is the space where one can actually "live." It is the sum of the areas of all the home's components and includes spaces such as bedrooms, living rooms, interior circulation areas, closets, bathrooms, built-in wardrobes, and storage rooms. However, it does not include walls, partitions, staircases, garages, storage rooms, porches, gardens, swimming pools, balconies, open terraces, and other non-habitable spaces.
Semi-Detached House
A Semi-Detached House originates from the term "geminate," meaning "to arrange in pairs." These houses are characterized by being side by side, often symmetrical, sharing the same facade, roof, and, frequently, the same floor plan.
Urban Property Registry Certificate
The Urban Property Registry Certificate is a document issued by the Tax Authority that contains information about the property and its owner(s). It is one of the mandatory documents for selling a property. This document includes:
- Property identification and Registration Number.
- Exact location and addresses.
- Description of the building and property.
- Details about the fraction and the property valuation data.
Energy Certificate
The Energy Certificate is a mandatory document for finalizing contracts when selling or renting a property. This document rates the property's energy efficiency on a scale from A+ (most efficient) to F (least efficient) and is issued by certified technicians from ADENE - the Portuguese Energy Agency. The certificate allows buyers to assess and compare the building's overall energy performance, understand potential energy improvement measures, and learn about the property’s energy consumption characteristics.
CPCV
The Promissory Contract of Purchase and Sale (CPCV) is directly related to the purchase or sale of a property. Although not mandatory, it is highly recommended as it establishes the obligations and protects the rights of both parties in the transaction until the final Deed of Purchase and Sale or an authenticated private document is signed.
Stamp Duty
Stamp Duty (IS) is a tax applied to acts such as purchase and sale contracts, mortgages, and other documents related to property transfers in the real estate context. Interestingly, it is the oldest tax in the Portuguese fiscal system, created in December 1660.
IMI
The Municipal Property Tax (IMI) is a tax levied on the Taxable Patrimonial Value of the Property, which results from the property's valuation performed by the tax authorities and is listed in the Property Registry Certificate. Certain criteria may exempt buyers from IMI, such as purchasing a property for permanent residence.
Housing Permit
The Housing Permit is a document issued by the local City Council where the property is located. It is an authorization confirming that the property has been inspected and complies with applicable laws for habitation. This permit is mandatory for selling a house and must be presented in all formal acts, such as the Promissory Contract of Purchase and Sale (CPCV) and the final deed.
Capital Gains
Capital Gains are the difference between the sale price of a property and the purchase price. If you sell for a higher amount than you purchased, you will generate capital gains (profit), which are subject to taxation. The calculation formula is:
Capital Gain = Sale Value - [purchase costs (IMT and deed) - sales costs (real estate commission) - improvement expenses (last 5 years)] - acquisition value × currency devaluation coefficient.
Spread
According to the Bank of Portugal, the Spread is "the component of the interest rate that is added to the index." In Portugal, this index is the reference interest rate – Euribor – which represents the estimated rate banks within the EU charge each other for loans.
Effort Rate
The Effort Rate is one of the main criteria used by banks to assess loan eligibility. This rate represents the ratio of financial expenses to the household's total available income. In other words, it determines how much financial capacity the client has to meet the loan commitment.
Effort Rate = (Monthly Loan Payments ÷ Total Household Income) × 100.
