Did We Make a Huge Mistake?
Second-guessing our decision...
As I begin this post it is Saturday, 4 March. We are in Braga1 I just returned from a fantastic art supply store.2 The sun is warm, and the tulips are in bloom … I am overcome by the beauty of this city. It is at moments like this that I wonder, did we make a mistake?
Yesterday
Actually, it was Friday when I first asked the question. We arrived Thursday night after spending a few hours at the furniture supplier we choose. Our Airbnb, in a central part of town, was clean and bright. Our host and his mother greeted us warmly. Yes, this apartment would be just fine. As soon as they left we cranked up every available heat source…it was cold and damp.
The next morning I raised the question as we were driving the 45 minutes back to Paços da Ferreira. “Do you ever think we jumped too quickly? Do you think we should have spent more time trying out different places before we settled down?”
Denise’s immediate response was, “It is too cold here. You would hate the weather.”
The Decision
Some of us never stray far from where we were born. I, on the other hand, purposely choose a university away from home. Many of us are prompted to move by a new job or promotion. Some places we like more than others…but this is what you do as you climb the career ladder. When we face retirement we think long and hard about where to live. Without children, our options were wide open. We considered climate, taxes, amenities, etc. Then 2016 added another thing to consider….politics. How strange!
The Ultimate Decision
Then the decision to leave the US…to move to Portugal. At first, just for a few years…we’ll rent. Then forever…and my inexplicable need to own a home.
At this point, you are likely wondering why I am rambling on. Actually, this post was prompted by two unrelated events. First, our visit to Braga … a beautiful, vibrant city. We have visited many towns and cities in Portugal over the past two years. All have their own unique charm. However, this was the first city that sang to me as we drove in and the music continued as we strolled its streets. (And it wasn’t only because there were street performers on many corners.)
The other impetus was a post I read by another blogger living in Portugal. She suggested that the long-term rental market was so tight that people seeking D7 visas buy before they move to Portugal. I won’t argue with her on her first point … the rental market is extremely tight. There aren’t that many choices and the available options may not be up to one’s exacting standards.
But I am concerned by her recommended solution. Unless you have spent a lot of time in Portugal, I would encourage you not to do what we did. While we rented when we first arrived it was only one year before we bought. We are not patient people … but I would encourage you to rent something3 and take the time to explore. Yes, Portugal is less than 25% the size of California, but there is still a lot of diversity in this small country. And while there are many similarities with selling a property4 in the US…there are some differences.
It seems to me that Portuguese are less transient; thus fewer transactions per person.
You are likely to buy a property that is on the higher end of the market; reducing the buyer pool further.
Portuguese real estate agents and the real estate market work very differently than you might expect (agents don’t work on Sunday, “open houses” are not a thing, there are no “agent caravans”, lock boxes are not used, etc); making for a less efficient selling process.
And from a purely financial perspective, this may not be the best time to buy.5
Second-Guesses
But I don’t want you to conclude that I am suggesting renting solely for financial reasons!
No, not at all.
Rather I don’t want you to waste a minute of your remaining years second-guessing your decision. This is something that I, unfortunately, spend too much time doing. Why did I waste 4 years of my life in that relationship? What would my life have been like if I had taken that job in San Francisco? The list goes on and on… This is one of many differences between Denise's and my personality and led me to wonder why.6 Is it because...
I think there is only one right answer or way of doing things? I am a bit OCD.
Is it a fear of commitment? Probably not.
Is it a form of insecurity, or lack of self-confidence? Perhaps…
Long-term readers know that my writing is an inexpensive, yet perhaps ineffective, form of therapy…so let’s move on.
You are likely wondering if my second-guessing continues. Yes and no. Am I happy in VRSA? Absolutely…there are many things that I love about this town. We have a wonderful circle of friends, and I love the small-town feel. We enjoy the proximity to Spain and have found a wonderful golf community. And as I finish this post on Tuesday morning, the sun is shining and the temperature is warming. Finally, after speaking to a Braga-nite (not sure if that is really a term) who mentioned that Saturday was the first time he had seen the sun in weeks I think Denise is right. I would hate the weather.
But I am certain we will return to the Airbnb again over the summer for a week or two or three….
Finally, you probably know that Portugal has ended its real estate Golden Visa program. This is just one of many changes that may effect persons coming to Portugal. The video below, in my opinion, provides a fair and balanced review of the program and why these steps were taken.
Acha que estou louco? Sim, às vezes também acho que sim. Até à próxima
Nanc
The primary purpose of our visit was to finalize all our furniture decisions, most of which are custom. Pieces, wood finishes, upholstery, lighting, rugs, etc. Next week we’ll share what that experience was like.
We don’t have a large high-quality art supply store in VRSA. There is a small one…but their selection is very limited. And the paints they sell at the China Stores are not “artist grade”. I miss wasting time perusing the store just 1/2 a block from our Cascais apartment.
It likely will not be your dream accommodation. I sometimes feel like we are camping in the apartment we are currently living in. It is too small, too cold, ill-equipped, etc. … but it is not forever. That being said, I understand that packing and moving are a pain in the rear. And whilst in the midst of it you pledge never to do it again! However, in the grand scheme of things, a few days of inconvenience must be weighed against the alternative or lack of alternatives.
Agent commissions average 5%, if you buy another house you can avoid capital gains, etc.
“According to Moody's, Portugal will not escape a correction in house prices in the near future, meaning that house prices in Portugal in 2023 could be about to drop. The financial rating agency considers that property prices in the country "exceeded the intrinsic values" of the assets, i.e. they are overvalued”. — Idealista.pt, 2/2023
If you think you spend too much time second-guessing your decisions read this article.
We spent several years traveling around the U.S. in a motorhome before moving to Portugal last Fall, and I can tell you the one thing I was absolutely sure of by the end was that, when it came to assessing any given place, nothing mattered more than the weather. In other words, we never hated a place where we happened to have good weather during our visit, and we never loved a place where we happened to have bad weather during our visit. So, my guess is, if you visited Braga in January, you would quickly conclude that VRSA is the place for you. :)
In the meantime, I don't know whether it's our years of nomadic living or just my cautious nature, but I am absolutely an evangelist of the "rent first" mentality. It boggles my mind that people buy homes in a foreign country before ever having lived there. Perhaps we'll regret our slow decisions some day, but for right now, I like maintaining a light touch in these first few years.
This is a great article and should be required reading for everyone planning to make the move.
I totally relate to this article! I too am a person who is always second guessing our decisions. My husband and I moved to Portugal May of 22, we found a lovely apartment in Setúbal while still living in the states. We were happy with it, minus the one bathroom situation and no yard for our two weenie dogs. Being the person I am and one of our first friends we meet being a realtor I couldn’t help myself from looking at putting down stronger roots. Why waste money renting was my way of convincing my husband. At the time it seemed like a strong market and I felt we would be safe in buying. So 3 months in we found what we thought would be a perfect home to invest in even though it was more money than we initially expected to pay.
We launched into this very weird and unsettling process of buying. I mean paying 10% directly to the seller and not an escrow company seemed odd we marched on. After sharing every bit of our financial situation with what seemed liked everyone we knew and a long drawn out process just short of of our contract to obtain financing and get our deposit returned we were denied. This after being assured we would have no problem. After all we were only seeking 40% of the cost of the home. But not having a pension and only living off savings and our investment funds wasn’t enough even though it is far exceeded the loan amount. At this point we were disillusioned with the process and with rumblings of a market crash we decided we might be better to continue to rent. Oh btw the sellers spent our deposit!! That’s another story!
However our current apartment had been rented and we were about to be homeless. After exhausting the rental market in Setúbal with no good options we thought let’s take a look in Lisbon, the city we originally thought we would move to before finding Setúbal. After a couple weeks of driving in to Lisbon nearly everyday to look at apartments, which had people lined up before and after us to for viewings and being denied a couple times due to our dogs we found a lovely place in Benfica. My husband says you could pick up this apartment and put it in any city in the US. It felt like home. We set out to make our pitch to the landlord. We created a profile much like we did when we were adopting our boys.(who are in college back in the US).
In our offer we proposed a years rent upfront and a sizable deposit.
It worked we were excepted! We’ve been in Lisbon now for 3 months and love it! Minus the friend network we had procured in Setúbal and paying more than twice what we were in Setúbal we feel like we made the right decision for us.
We recently spent a long weekend in the Douro Valley fell in love and now question our decision.🤦🏻♂️ ugh!
Thank you for your sharing your experience we enjoy reading your blog and following your experience as they seem to mirror much of our own experience.
Maybe one day we can meet up!