IMT Exemption for Young People: What Does the Law Say?
Buying your own home is a dream for many young people, but the burden of taxes can make this dream difficult to achieve. The good news is that the Portuguese Government has introduced an exemption from IMT (Municipal Property Transfer Tax) for young people purchasing their first home. This measure aims to facilitate access to homeownership for young people, combat housing insecurity, and boost the real estate market.
If you are thinking about buying a house and have questions about the IMT exemption, this article is for you!
Who Does This Measure Apply To?
In summary, the IMT exemption applies to:
- Young people up to 35 years old at the date of the purchase contract.
- Purchase of a property intended for permanent private residence.
- Properties with a value equal to or less than €350,000.
- Young people who have never owned, or been the spouse of someone who owned, another property intended for housing.
Advantages of IMT Exemption for Young People
The IMT exemption for young people offers a set of benefits that significantly facilitate access to homeownership. Let’s analyze each of the advantages based on what is defined in the law:
1) Substantial Savings:
Immediate Cost Reduction: The IMT exemption translates into direct savings on the total cost of buying the house. For a property valued at €300,000, the IMT exemption represents savings of €13,700, a significant amount that can be used for other expenses associated with buying a house, such as renovations, furniture, or financing.
Increased Purchasing Power: By eliminating the IMT, the amount available for purchasing the house increases, allowing young people to access properties with larger areas, better features, or in more valuable areas.
2) Ease of Access to Homeownership:
Elimination of a Financial Obstacle: IMT was one of the main tax burdens associated with buying a house, representing a significant obstacle for many young people. Its exemption makes the purchasing process more accessible and facilitates the realization of the dream of homeownership.
Flexibility in Property Choice: With the IMT exemption, young people have more freedom to choose the property that best suits their needs and budget, without the pressure to restrict themselves to lower-valued properties to avoid paying the tax.
Increase in Property Supply: The IMT exemption may encourage property owners to put their properties up for sale, increasing the supply of houses on the market and favoring demand from young people.
3) Economic Stimulus:
Boosting the Real Estate Market: The IMT exemption contributes to increasing demand for houses, driving the real estate market, and creating a positive effect on the economy.
Job Creation: Increased activity in the real estate market generates new job opportunities in areas such as construction, real estate mediation, and financial services.
4) Improvement in Young People’s Quality of Life:
Access to Decent Housing: The IMT exemption facilitates access to homeownership, allowing young people to have a stable and quality home, essential for their physical and mental well-being.
Promotion of Emancipation: Purchasing a home can be an important step in the emancipation of young people, marking the beginning of a new stage in their lives.
The IMT exemption for young people is an advantageous measure that helps facilitate access to homeownership, boost the economy, and improve the quality of life for young people. If you are thinking about buying a house and taking advantage of this opportunity, do not hesitate to contact me.
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