By Posted 17 Outubro, 2024 In News, Property, Property Tax, Real Estate, Youth Tax
There has been an increased demand for mortgages from young people aged 35 and under following the government’s decision to exempt this age group from paying property taxes.
According to a quarterly report from the online estate agency portal Idealista, young people in Portugal now represent 49.2% of applications for mortgages, compared to 35.8% in 2023 before the measures were introduced.
Young people aged 35 and under are exempt from paying IMT property tax – a tax paid when a property is transferred from one owner to the other, and IS stamp duty.
The 25-35 group lead applications (39.7%), while young people to 25 years increased their share to 9.4%.
The debt-service-to-income rate varies between 29% and 36% while young people to 25 years of age with incomes between €2,000 and €4,000 (37%) with an average debt-to-service-income rate of 33% are those who most take out mortgages, yet 66% earn less than this salary level.
Those with incomes under €2,000 represent 18% of mortgage contracts with debt-to-service-income rates of 33% on average.
Young people with incomes over €10,000 per month also represented 18%, with a debt-service-to-income rate of 31%