Finding a Real Estate Agent in Portugal

Buying a home in Portugal when you don’t speak Portuguese requires a little strategy. A buyer’s agent can help, but you can help yourself even more by being informed. Four tips on researching the housing market in Portugal and finding a Portuguese real estate agent.

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Real Estate Agent in Portugal
In my experience, real estate agents in Portugal are about as helpful (or unhelpful) as they are in the United States.  There’s a lot of variation.  Some agents have a great eye for quality construction, the micro dynamics of a particular neighborhood, and can accurately predict how long a property will be on the market before selling.  Other agents – the majority, I suspect – are just mediocre. But if you’re completely unfamiliar with the Portuguese real estate market, and especially if you don’t even speak the language (though hopefully you will learn; you can do it!), it may be difficult for you to determine if an agent is actually adding any value to the process.
Many people wonder if you need a license to be a real estate agent in Portugal.  The answer to this question is: sort of.  In principle, a licensed realtor would provide at least a minimum quality baseline from which to judge who’s competent and who’s not. However, in Portugal real estate agencies hold a license, but individual agents are not required to have any sort of professional certification.  They just affiliate with a licensed agency.  Furthermore, any commercial entity with civil liability insurance who pays the application fee can apply for a real estate license, or licença de mediação imobiliária as its known here, without any particular knowledge about real estate at all. (In the United States, real estate agents typically need to pass a licensing exam; it depends upon the state.)  That means, if the manager of a licensed real estate agency in Portugal wants to hire his unemployed cousin João who’s been going through a divorce and just needs to pick up some extra cash, well, hopefully the manager has better sense, but there’s no legal impediment preventing him from doing so.
To put some numbers behind this, consider the US National Association of Realtors, which recognizes the Certified International Property Specialist (CIPS) designation.  CIPS certification indicates that US and non-US real estate agents have demonstrated expertise in international real estate transactions, particularly in areas such as foreign exchange rates and tax compliance issues. However, there are only 111 CIPS agents currently certified in Portugal, while there are more than 8,000 real estate agencies with an unknown number of agents working there, but estimated to be around 35,000.  On top of that, the number of Portuguese real estate agencies has almost doubled since 2011 alone.  Everyone and their mother wants to be a real estate agent nowadays.
This tells me only one thing: it’s virtually impossible that all these people know what they’re doing.  So, how do you separate the wheat from the chaff?
By doing your homework.
Here are four suggestions about how to research the Portuguese real estate market so that you’re better informed about your options and can determine if a real estate agent is trying to sell you a bridge or not.
Note: This article is informational only.  I am not a legal or financial professional, just an experienced home buyer, so always seek guidance before you make any legally or financially binding decisions. 

Know Your Market First

To begin, make sure you have a good overall sense of where the Portuguese real estate market is at in terms of your options for buying and/or remodeling.  My Portugal Real Estate Watch post provides an introduction.  If you’re considering financing your home purchase, you can also take a look at my Getting a Mortgage in Portugal post to better understand that process as well.
Once you’ve narrowed down the geographic area and price range you’re focusing on, it’s time to jump online and take advantage of big data.  But – and this is an important but – you need to do this methodically.  If you can put together a simple Excel spreadsheet and do some minimal data analysis, it will go a long way in helping you understand what’s out there and getting the most out of your eventual agent’s expertise. 
Now, Portuguese real estate agents often claim that the online house hunting platforms are incomplete and that they, the agents, can give you access to a wealth of insider information offline because they have a lot of “contacts” in the industry.  I’m skeptical of this claim.  Portuguese properties not listed online on platforms like Idealista or Imovirtual, or directly on a real estate agency’s own website, are more likely to be luxury properties where the seller is trying to feel out the market first by getting an agent to ask around among a select group of potential buyers on the down low.  Beyond that, there’s not much incentive for the average seller to not have a property publicly listed.  In fact, in Portugal you’ll sometimes find the same property listed with multiple real estate agencies because the seller wants maximum exposure and will give the commission to the first agency that brings in a buyer or has some sort of agreement in place that the agencies will split the commission.   More likely than not, an online platform will be sufficiently comprehensive for you at this point.
Start with a search of properties in your target area and price range.  (You might want to go a little over your max price just to inform yourself of what that higher price will or will not buy you.)  As you flip through the listings, add the ones you like to your spreadsheet.  At the beginning, include any place that’s even remotely interesting.  A longer list of “maybes” will help you evaluate whether properties are under- or over-valued later. 
Here are the most important variables to record in your spreadsheet: the property’s address, with a link to the full listing; city; neighborhood, if you know it; the real estate agency that’s listing the property; the number of beds/baths; the number of parking spaces; the asking price; and the most important variable of all, the area of the property in square meters so you can calculate the price per square meter (i.e., the asking price divided by the area).
In the United States, the price per square foot is not usually an important metric buyers look at, but here, the price per square meter is given substantially more weight.  If you’ll be getting a mortgage in Portugal, the bank’s appraiser will be paying close attention to the property’s price per square meter relative to that of similar properties in the area.  (Even if you are willing to pay a higher price per square meter, if the appraisal comes in lower than the market value, it may have an impact on how much financing the bank will give you for a mortgage.)  If you’ll be doing remodeling work later, the construction company will talk about the going rates for remodeling in terms of price per square meter. 
[A technical note on the terminology for calculating area in Portugal.  On the English version of real estate websites, you will often just see a simple line saying something like “area: 150 m2” but that number may reflect one of several different measurements.  The first is área bruta or the total area of the property’s perimeter, which includes the area of the house/apartment plus garage space, balconies/verandas, and storage areas.  If the seller gives you the área bruta number, it could make the living space seem bigger than it actually is.  The second area is área util, essentially the livable area contained within the walls of the house/apartment, so it is always smaller than the área bruta. The third is área bruta privativa, which is the área bruta but not including garage space, balconies/verandas, and storage areas.  Real estate listings are required by law to include the área util, however, compliance is not 100%.  The way to really know the true area of a property is to see a copy of the caderneta predial, a tax document for the property, issued by the Finance Ministry, which contains much the same information as a property deed.  It indicates who owns the property and the exact area, among other pieces of information.  When you eventually make an offer on a property, the seller should furnish you with a copy of this document, but if you have doubts about a property’s area prior to getting to the offer point, you can always ask the seller’s real estate agent to show it to you.]
Go ahead and add in other categories to your Excel spreadsheet that matter to you personally, such as whether there’s a pool or if there’s a separate laundry room.  This will help you determine if your “need to haves” are worth their additional cost.  Aim for ten or fifteen properties you find sufficiently interesting so you have something to work with.  Again, be inclusive at this point because this is just a data mining exercise.
Once you’re satisfied with your list, sort the properties by highest price per square meter to lowest.  Then, try to figure out what explains the spread. 
As is the case everywhere, well-located, larger properties in better shape remodeling-wise will generally fetch a higher price per square meter than others.  So do really unique properties when compared to a more cookie cutter place.  Does the property have a view? A large terrace? Near the ocean?  In a cool part of town?  If so, the higher price per square meter may be justified.  But sometimes sellers are just being unrealistic.  Usually, you can get a sense of this without having to physically visit each and every property. 
In Portugal, I’ve found that the best website to start with is Idealista.  You can also look on the websites of the major international real estate agencies that also have operations in Portugal: REMAX, ERA, Century 21, Sotheby’s, and Keller Williams.  Usually, their properties are also on Idealista, but it doesn’t hurt to cross check.  Sometimes a property that shows as for sale is actually under contract, but for the most part, between Idealista and the agency sites, you’ve covered pretty much everything that is currently available for sale in your search area.
Armed with this information, you have a good shield against some of the more fantastical claims of both real estate agents and property sellers.  It will also help you decide where in the price spread you want to focus your search.
And this, right here, is more than what most real estate agents will do for you. 

Options for Agents in Portugal

There are three basic categories of real estate agents you can work with for buying property in Portugal.
The first is a real estate agent who works at a real estate agency that lists properties for sale and represents sellers.  In other words, a seller’s agent, not a buyer’s agent – though they’ll be quick to say they have your best interests at heart, too.  Much of this market is dominated by the large international real estate agencies mentioned previously.  If you call up REMAX or an agency like it and tell them that you’re looking for a new condo, an agent will take you around to properties listed through REMAX.  Some real estate agencies are more flexible about this and will let realtors take clients to properties listed by other agencies, but many are quite strict.  This is a disadvantage of working with a seller’s agent as a buyer.
The advantage of the larger real estate agencies is that they often have an in-house financial brokerage that can help connect you to a bank if you need a mortgage.  But any decent agent has connections on the financing side and can help you with this.  Given the influx of foreign buyers in Portugal, the larger agencies will also have English-speaking agents.  If you don’t speak Portuguese, or don’t have a translator, this will be important.  However, most Portuguese real estate agents will speak at least passable English no matter where they work.
The second category of agent is a buyer’s agent. In Portugal, contracting with a buyer’s agents was less common historically, so there weren’t very many of them.  With the rise of expat investors that needed more hand holding in real estate transactions, independent agencies exclusively representing buyers started sprouting up.  They do not list properties for sale.
Portuguese buyer’s agents sometimes charge an up-front fee to bring buyers around to showings, so they get paid whether you buy a property or not.  The fee can be several thousand dollars for a package deal of home purchase and mortgage assistance.  Some buyer’s agents will refund their fee if you buy a property with them and instead take a cut of the sale as a commission paid by the seller. 
Because buyer’s agents are mostly oriented towards non-Portuguese buyers, many will advertise their specialization in working with expats.  Personally, I’m not convinced this means very much because unless they offer full-service concierge assistance for relocating to Portugal, including visa assistance and help with other legal issues, the process for a Portuguese resident and an expat to buy a home in Portugal is the basically same.  There’s not separate “here’s how an expat buys a home” and “here’s how a Portuguese resident buys a home” tracks, though it may seem like it because you as an expat might have to do things that a Portuguese resident will not.  They already have a tax ID number and a bank account, for example. The main difference is that it can be more complicated for an expat to get a mortgage in Portugal. Well, that and the fact that buyer’s agents assume Mr. and Mrs. Expat will pay more per square meter than Sr. and Sra. Portugal and that The Expats are worth a bigger commission because it’s true.
The third category of agent is not really an agent at all but your Portuguese friend’s downstairs neighbor who moonlights in real estate and is not formally affiliated with a licensed real estate agency.  You’re on your own with that one.
Unless you’re paying an upfront, non-refundable fee, it won’t be any cheaper to use an exclusive buyer’s agent versus a seller’s agent at a large real estate agency.  Although in theory a buyer’s agent better represents a buyer’s interests than a seller’s agent, at the end of the day, both buyer’s agents and seller’s agents have the same incentive to close the deal as quickly as possible at the highest possible price they can get away with: their commission.  So, I wouldn’t get too hung up on the distinction.
Still, if I didn’t speak Portuguese, I’d probably go with a buyer’s agent that would refund the fee if I bought a property.  But I wouldn’t do anything without doing my market research first.  The agent should be able to tell you what your spreadsheet does not.  If that’s *all* they can tell you, though, that’s a red flag.

When to Reach Out to an Agent

You do not technically need a real estate agent to visit properties in Portugal.  All you have to do is get in touch with the contact person for a particular listing, which is usually the seller’s agent, and make an appointment for a viewing. 
Of course, the seller’s agent will start asking questions about what you are looking for and naturally be inclined to give you the hard sell on why you should view other properties that this agent represents.  If you’ve done a thorough job on the Excel spreadsheet exercise, they may not be able to show you very much that you haven’t already considered, but if they’re worth their salt, they will.  It’s also possible that you strike up a good rapport with the agent and would be happy to continue working with them, which is totally fine, keeping in mind the above constraints on what they may be able to do for you.
If you’ve already bought and sold property in the United States or elsewhere, and if you feel confident evaluating properties on your own, you can do this indefinitely without a buyer’s agent.  You don’t even need an agent to make an offer, though you will most likely make an offer through the seller’s agent, who won’t necessarily be inclined to tell you to lowball even if the seller might accept it.  (There are some “for sale by owner” properties out there, but not many.  You can find these on Idealista.)  Absolutely indispensable is a lawyer to review the purchase contract before you sign it, as well as any other legal/financial documents you don’t understand.  If you are getting a mortgage, the closing will be held at a notary of the bank’s choosing and the bank will walk you through all the legal and financial documentation necessary to finalize the purchase beforehand.  Beyond that, the value of an agent is highest up until you make an offer, especially when you are inexperienced with real estate or a particular real estate market, or are not the do-it-yourself-type.
For that reason, if you’ve never bought a property anywhere, or if you aren’t confident evaluating properties on your own, you might want to reach out to an agent for assistance before you start visiting places. 
Obviously, you’ll want an agent that specializes in real estate in your city, and Google is a decent place to start looking.  Many expats will also ask around in expat circles for real estate agents other expats have already worked with, and this is a reasonable step.  However, the buyer-agent relationship is highly personal, and just because an agent was great for someone else doesn’t mean they’re a good fit for you.  Try to meet with more than one agent so that you can get a feel for what it would be like interacting with this person for, potentially, months on end.  This is more art than science, unfortunately. 

Evaluating Your Agent

Real estate agents in Portugal, especially seller’s agents, often use the same tricks of the trade as they do in the United States.  Agents will tell you the housing market is on fire and the seller probably won’t budge. They’ll tell you that you need to increase your budget to find what you’re looking for.  And they’ll try to convince you to put in an offer yesterday because the property is going to sell tomorrow.  Sometimes these things are true, or true-ish.  Other times…well, you might end up waiting outside a property before going in to see it at the appointment time because another agent is inside with a potential buyer who is interested and they ran over at just the *exact* moment you showed up, even though the property has been on the market for eight months with no offers.  (This happened to me.  Talk about amateur hour.)  Again, the better informed you are about the market, the better you can see through the smoke and mirrors. 
Lest I sound like I’m bashing on real estate agents unfairly, let me point out that a really high-quality agent will have good intuitions about things that you won’t easily find online, such as whether the particular kind of kitchen style the owner shelled out for in a rehab is really what people are looking for right now, or the demographics of a particular micro-neighborhood of a larger neighborhood of most interest to families with children.  That’s worth something.  How much is it worth, though?
Not much if you don’t like the agent or get a bad vibe from the person.  You have to go with your gut at some point and it’s OK to stop working with an agent if it just doesn’t feel right.  This is why it’s important to make sure you haven’t locked yourself into a contract, or paid a fee without making a purchase, before you’ve talked to more than one potential agent so you can avoid this situation from the get-go. 
Ultimately, real estate agents are here to help you, but the best thing you can do is help yourself first by knowing the market.  And be confident! Just because someone calls themselves a mediador imobiliário doesn’t necessarily mean they have vastly more real estate knowledge than you do.
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