The complete guide to buying a property in Cape Verde is here!

Buying Property in Cape Verde

Whatever your reasons for buying a property this is probably the first time that you have bought a property in Cape Verde, or even abroad. We have put this guide together to help you understand a little more about the process of buying in Cape Verde.

This guide is aimed at providing some basic information about buying in Cape Verde and tries to answer the majority of the common questions that we are asked about. Although we hope that you will find it useful it is important to remember that it doesn’t cover all legal issues involved and certainly isn’t a step by step DIY guide to buying in Cape Verde. It is still recommended that you seek advice from a professional before proceeding – after all we do this every day and have been doing so for many years and therefore know all the tricks and pitfalls that you may come across.

We also know the practical solutions to the problems that exist and also know how Cape Verdean Law interacts with European law.

Costs and timings

The total cost of purchasing in Cape Verde is normally cheaper than in Europe. For the acquisition of a property, the price and taxes relating to the transfer of the property are due such as “IUP de transmissão” equal to 1.5% of the commercial value (if the asset value is higher, the tax will be applied to the latter), the cost of the Notary is 420 euros and also includes the registration of the property in the name of the buyer

To start a sales process you will need to sign a reservation contract or a Promissory Purchase and Sale Contract and pay a small deposit, which we call “Sinal”. Signing this contract is the most important sign that you wish to proceed with the property purchase, because a payment is made and the vendor is also obliged not to proceed with the sale to another person in the meantime.

After that you would work towards a full purchase contract and pay typically around 15% deposit. That contract commits you to buy the property.

On a new property you may have to make stage payments throughout the course of construction.

The balance of the purchase price must be paid by the buyer to the seller or a lawyer with power of attorney by the date of the notarial deed.

Normally, an international transfer takes between 4 and 5 working days, depending on bank times, so it is advisable to pay the balance at least 4 days before the notarial deed. Of course, if it is a national transfer, the time would be reduced to between 24 and 48 hours.

When signing the deed, the seller or his representative must declare that he has received payment of the balance of the purchase price and must prove that he has paid all the fees relating to the property sold, i.e. community fees, annual tax (IUP) and water and electricity consumption up to the date of the deed.

Mortgages

There are two ways of financing your purchase in Cape Verde.

The first is to release equity from your Europe assets to buy the property in Cape Verde. The second is to mortgage the property in Cape Verde. Each has advantages and disadvantages but getting it wrong can cost you dearly so take advice on this.

NIF

The NIF (Número de Identificação Fiscal, which translated literally is your Foreigner’s Identity Number) is your Tax Identity Number in Cape Verde.

There are several times when you are likely to be required to produce your NIF number;

When you buy a property
Opening a bank account
Dealing with the utility companies
Taking out insurance
Dealing with the tax authorities
Buying or selling shares, bonds and stocks
Buying a car

At the moment you can apply for your NIF personally, or through your representative. We will therefore advise you how this works at the time that you contact us.

Residents Association (Associacáo de Propietários)

If you are buying in a complex then there will be a Community of Owners. We would need to make sure that all Community charges have been paid up to date before you buy.

Water and Electricity

It is important to check that there is a connection and that the charges are paid up to date. The real estate agency will have to verify that the seller has paid all the invoices and close the previous contract in order to open a new contract between Electra (government electricity supply company) and the new owner

Land Registry (Registo Predial)

Almost all land and properties in Cape Verde are now registered, but our experience tell us that the registration should be duly confirmed.

We would obtain a search at the local Land Registry for office copy entries of the previous owner’s deed which will show who the registered owner is and whether there are any charges on the title. The Land Registry has the history of all the events concerning certain property. Once you become the owner, you will appear as the current owner and you can transfer from the previous owners, and issues such as mortgages registration or others (usufruct and liens).

Tax over the Property (IUP—Imposto Único Sob o Património)

The annual property tax (IUP) is 0.33% calculated on the basis of the updated asset value of the property and must be paid yearly in two installments.

Community Charges (Quota de Condomínio)

The cost of the condominium is calculated on the thousandth distribution of ownership and varies from case to case. Check with the real estate agency what the annual costs are before proceeding with the purchase

Buying property in Cape Verde faq’s

Is the legal system in Cape Verde the same as the Europe?

They are very different, but there is an interaction between the two legal systems. That is why the best person to advise you on your purchase in Cape Verde is somebody who understands both Cape Verdean and European law.

Do I need a lawyer to help me buy in Cape Verde?

Surprisingly this is the most common question that we get asked. No, you don’t – just like you don’t necessarily need a lawyer when buying a property in Europe.

Obviously if you cannot personally sign the notarial deed or do you feel safer being supported by a law firm, a lawyer in Cape Verde can take care of the whole process for you, will be able to pay the taxes for you, and managing the payments to be made to the seller on your behalf.

We work with serious lawyers who speak your language so if you need to speak with one of them contact us to get in touch with his office.

I have been told that I don’t need a lawyer but need a Notary. Is this true?

The Notary is important in Cape Verde but tends only to get involved at the end of the transaction. His role is to carry out some basic checks at the end and attend to the signature of the title deed and in some cases to register the property. He doesn’t normally advise on whether the contract is OK to sign, whether you should pay the deposit, who should own the property, and so on.

I have heard that there are problems with buying property in Cape Verde. What is the situation?

Most of the potential problems that you read about can be avoided by using common sense and by instructing a real estate agency to advise you on the purchase. Cape Verde is an emerging economy and the advise is very important so that you can be aware of the construction situation and companies reliability.

Talk with our sales team

The complete guide to buying a property in Cape Verde is here!

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