What it costs to keep a home: IMI, condominium fees, insurance

IMI: how the bill is put together

IMI is the property's tax value (VPT) multiplied by the rate each municipality sets every year, within the band the law allows. The part that catches almost everyone out is this: the VPT is not the purchase price. It comes from a formula involving floor area, use, location, quality and comfort, and the age of the building. Two homes bought for the same money, one new and one old, or in different municipalities, can pay very different IMI.\n\nThe VPT appears on the caderneta predial, which you can pull from the Portal das Finanças. The rate is the one set and published by the municipality where the property sits. If the elements behind the VPT have changed, the owner can request a new assessment. Exemptions exist and all of them come with conditions: there is a temporary exemption for a permanent main residence, subject to a VPT ceiling and to household income, and an exemption for low-income households. Many municipalities also apply a deduction per dependent child. Property holdings above a certain value attract an additional charge, AIMI. The ceilings and percentages move with each state budget, so check the Portal das Finanças and never a table copied from an old article.\n\nOn timing: the IMI for a given year is owed by whoever owns the property on 31 December of that year. The bill arrives the following year and can be paid in one go or in instalments, depending on the amount. Buy in September and the whole of that year's IMI is yours, payable the year after.

Condominium: the fee, the reserve fund and the works not yet voted

In a building under horizontal property, your condominium fee is your share of the annual budget approved by the owners' meeting, split according to the permilagem (thousandth share) of your unit as set in the title deed. It pays for what the building consumes and what keeps it standing: cleaning, common-area electricity and water, lift servicing and inspection, insurance on the common parts, management, and where they exist, garden, pool, concierge or security. A building with more services carries a higher fee, every month, permanently.\n\nPart of the fee feeds the common reserve fund, which the law requires the condominium to build up for maintenance works. That fund rarely covers a major job. Repairing a façade, a roof or a lift usually means an extraordinary levy voted in the owners' meeting and split by the same thousandth shares. Which is why reading the minutes of the last few meetings is worth more than asking what the fee is: works already discussed and postponed are the cost that is not yet in the fee and will surface.\n\nBefore signing, ask the condominium manager for the declaration of outstanding charges on that unit. The law provides for this declaration to be produced at the deed, unless the buyer states in writing that they waive it. Do not waive it. A unit with arrears and an approved works programme is a bill you discover after you have the keys.

Insurance: what is compulsory, what the bank demands, what is left out

Under horizontal property, the law requires fire cover on both the individual unit and the common parts. The policy taken out by the condominium covers the building's common parts. It does not cover your contents or damage inside your own home. These are different things and they are routinely confused.\n\nWith a mortgage, the bank requires a buildings policy (multirriscos) with the bank as beneficiary up to the outstanding balance, and almost always offers life cover tied to the loan. You can buy both away from the bank: the law allows it and the bank must accept equivalent policies. Do the arithmetic on the whole package before switching, because the spread discount attached to buying the bank's insurance can fall away and the cheaper premium may stop being cheaper. Life cover is not a fixed cost over the life of the loan: it rises with age and depends on the health questionnaire and any exclusions that follow from it.\n\nOne expensive and common mistake: insuring the building for the purchase price. The sum insured should reflect the cost of rebuilding the structure, excluding the land. If the sum insured is too low, the insurer can cut the payout in the same proportion when you claim. Review the figure periodically, particularly after refurbishment.

The costs that appear on no list

Water, electricity and gas all carry a standing charge you pay even with the house empty, tied to the contracted capacity. The water bill usually also carries the municipal waste and sewerage charges. Small per month, visible over a year.\n\nThen there is maintenance on its own calendar: periodic gas installation inspection, boiler or water heater servicing, air conditioning cleaning and servicing, and the replacement of equipment that simply reaches the end of its life. A home does not have zero maintenance cost for years and then one enormous bill; it has an average cost paid on an irregular schedule.\n\nThe energy certificate class is the best advance indicator of the heating and cooling bills you are about to inherit. It is not a decorative sticker. A poor class in a flat with no insulation and single glazing means higher consumption every winter, or building work to fix it.

How to estimate before you sign, from documents rather than averages

Ask for seven things and you will have an honest number for that specific property: the caderneta predial (which gives you the VPT), the last IMI bill, the current condominium fee, the condominium budget approved for the year, the minutes of the last few owners' meetings, the manager's declaration of outstanding charges, and the energy certificate. Add the most recent water and electricity bills if the seller will share them.\n\nFrom that you can build a defensible estimate: last year's IMI as the base, the fee annualised, insurance quoted on a correct rebuild sum, and your own maintenance provision. Where a figure is uncertain, round it up and write the uncertainty next to it rather than burying it in an average.\n\nThis is reading work, not negotiation, and it is the sort of thing a buyer-side adviser requests and checks before any offer exists. At Stonest Partners that support costs the buyer nothing, because the commission is paid by the selling side.

The mortgage instalment is not the monthly cost of the home

The bank assesses affordability on the instalment. Your life is assessed on the total. The real monthly cost of that home is the instalment, plus insurance premiums, plus the condominium fee, plus one twelfth of the IMI, plus your maintenance provision. That is the number that has to fit the budget, not the first one.\n\nThere is also a rhythm problem. The instalment is monthly and predictable; IMI and building works arrive in lumps on fixed dates. The practical fix is dull and it works: a standing monthly transfer into a separate account used only for IMI, annual insurance and extraordinary levies. When the bill lands, the money is already there.\n\nIf you are still choosing, use this as a comparison test rather than price alone. Between two homes at the same price, the one with a high condominium fee, a poor energy class and an unvoted façade repair is the more expensive one. It is only cheaper on the day of the deed.

Where to check the figures

• Portal das Finanças (caderneta predial, VPT, IMI e notas de cobrança)
• Portal Autárquico, DGAL (taxas de IMI comunicadas por cada município)
• Diário da República (Código do IMI e alterações introduzidas pelo Orçamento do Estado)
• Autoridade de Supervisão de Seguros e Fundos de Pensões (ASF)
• Portal do Cliente Bancário, Banco de Portugal (seguros associados ao crédito habitação)

We do not publish tax tables or percentages: they change with each state budget, and an out-of-date number on an agency's own site is a problem rather than a typo. The sources above carry the current value.