Since January 1, 2024, and following Decree-Law No. 10/2024, it is no longer mandatory to present a residential occupancy permit in purchase and sale deeds. The measure, created to simplify processes and allow more properties to enter the market, ended up opening the door to the sale of houses that previously could not be traded, namely properties built illegally or originally intended for commerce and services.

However, this expansion brought a side effect: as these houses do not have an occupancy permit, they cannot be financed through mortgage loans, leading many owners to demand that the purchase be made in cash.

Banks do not grant loans without an occupancy permit.
There is a growing number of advertisements that explicitly state the requirement for immediate payment, often justified by the absence of a permit. In cases where such an explanation is not given, several owners have confirmed that the lack of a permit is the reason why they demand immediate full payment.

The phenomenon is recognized by real estate agencies. In statements to Público, Manuel Alvarez, president of Remax Portugal, states that requiring cash payment “is not the most attractive way to attract interested parties,” but admits that there are situations where this represents an advantage, especially when there is an urgency to reinvest capital or when the house does not have a license for use. The manager estimates that the network already has “hundreds” of listings with this condition, although he acknowledges that the exact number is difficult to determine.

“60% of houses paid in cash”
According to Manuel Alvarez, only between 35% and 40% of houses are acquired using bank credit, which means that about 60% are paid in cash. The trend is particularly pronounced in areas of the country where there is strong demand and limited supply, although in regions with less real estate pressure it may remain stable or even decrease. In 2024, according to the National Institute of Statistics, 156,325 houses were sold in Portugal.

The high proportion of cash purchases is explained by several factors. One is the growing presence of foreign buyers, especially from North America and Europe, who have greater financial capacity and view full payment as something natural. Another factor is acquisition by investors who see real estate as an appreciating asset.

In addition, many transactions result from a change of residence: those who sell their previous home reinvest the proceeds in the next purchase, dispensing with credit.

Risks of buying a house without a building permit
Despite the apparent advantages, buying a property without a building permit carries significant risks. André Levi, an urban planning lawyer interviewed by Público, points out that these permits are required for buildings constructed after 1951 and are a fundamental requirement for their occupancy.

Use permits are directly associated with building permits and are intended to prove that the work complies with the approved plans and that the building is suitable for its intended purpose, including housing.

The lack of a permit generally indicates that the construction was illegal or did not comply with the authorized plan. The consequences can be serious: using a property without a permit can result in fines of up to R$ 250,000 and, in more extreme cases, lead to administrative eviction by the city government.

How to obtain the permit?

The process for obtaining a use permit depends on the urban planning situation of the property. If the construction was illegal, it is necessary to proceed with its legalization, respecting all urban planning regulations and the municipal master plan. When a building has been legally constructed or subsequently legalized, the procedure is relatively simple: it is only necessary to present technical documentation proving the completion of the works and compliance with the approved project, such as terms of responsibility and updated plans. After this notification and upon payment of the municipal fee, the property can be used immediately.

The legislative change has therefore allowed many properties without a use permit to enter the market, but it has brought new challenges for buyers and sellers. For those intending to buy a house, it is now even more important to verify the existence of a use permit beforehand, avoiding legal and financial risks that could compromise the investment.
Real Estate News