Property auction glossary
The essential property-auction terms, explained simply.
- Electronic auction
- Online sale of a seized asset on a platform (typically e-leilões), during a window in which interested parties bid.
- Enforcement sale
- Sale of the debtor's assets within an enforcement action, to pay a creditor. Run by an enforcement agent.
- Enforcement agent
- Professional who runs the enforcement action, including the seizure and sale of assets.
- Seizure (penhora)
- Judicial attachment of a debtor's asset to secure payment of a debt. The seized asset may be sold at auction.
- Base value
- The property's reference value (the valuation) from which the sale is defined. Not the final price — bids start here.
- Minimum value
- The value below which bids aren't accepted. In a first phase it's usually 85% of the base value.
- Opening value
- The value from which bidding starts in an electronic auction.
- Bid
- Offering an amount to acquire the asset. The highest bid above the minimum value generally wins.
- Deposit (caução)
- Amount (usually 5% to 20% of the base value) required to bid, refunded to those who aren't the buyer.
- Award (adjudicação)
- The act by which the asset is assigned to the winning bidder, after paying the amount due.
- Balance (remanescente)
- The remaining part of the price after the deposit, paid within the set deadline after the award.
- Transfer title
- Document formalising the transfer of ownership to the buyer at the end of the sale process.
- Encumbrance (ónus)
- A charge on the property (mortgage, lien, easement, lease). Some are extinguished by the sale; others may survive.
- Mortgage
- Security for a debt over a property. In enforcement it's usually ranked and cancelled by the sale.
- Ranking of creditors
- Ordering of creditors by payment priority from the proceeds of the asset's sale.
- Easement
- A charge that binds one property for the benefit of another (e.g. a right of way). May survive the sale.
- Land registry certificate
- Land registry document describing the property and the encumbrances and rights over it.
- Tax property record
- Tax authority document with the property's tax data and registry identification.
- Registry description
- Identification of the property in the land registry, including boundaries, area and entries.
- Notice (edital)
- Official announcement of the sale, with the property, values, deadlines and conditions.
- Terms of sale
- Document with the conditions of sale: payment terms, deadlines and charges that transfer.
- Conditions of sale
- The specific rules of each case that the buyer accepts by bidding.
- IMT
- Municipal Property Transfer Tax. Applies to the acquisition value on progressive brackets.
- Stamp Duty
- Tax on the property transfer (0.8% of the acquisition value), paid on top of IMT.
- Fees (emolumentos)
- Costs of formalising and registering the acquisition.
- Primary residence
- Tax regime for a property intended as the buyer's habitual residence, with distinct IMT brackets.
- True total cost
- The bid plus IMT, Stamp Duty, fees and works. The value to compare to the market, not the bid.
- Market value (VME)
- Estimate of what the property would sell for on the open market. The basis for assessing an auction's discount.
- Discount
- Percentage difference between the true total cost and the estimated market value. A good auction has a positive, sustained discount.
- Insolvency
- A situation where a person or company can't meet its obligations. Assets are sold to pay creditors.
- Insolvency administrator
- Professional who manages the insolvent's estate and runs the sale of assets.
- Tax sale
- Sale of seized assets promoted by the tax authority to collect tax debts.
- Citius
- Ministry of Justice portal where judicial sale announcements are published.
- e-leilões
- Electronic judicial-sales platform run by the Order of Solicitors and Enforcement Agents.
- Auctioneer
- Private company that organises auctions, often of assets from insolvency proceedings.
- Sealed bid
- A method where interested parties submit a single, secret proposal, opened at a set time.
- Failed auction (deserto)
- An auction with no valid bids. It may lead to a new phase with a reduced minimum value.
- Occupancy
- Whether the property is inhabited (by the debtor, a tenant or third parties). Affects delivery of possession.
- Possession
- Effective control of the property. Its delivery may require extra steps if the property is occupied.
- Right of first refusal
- The right certain entities or people have to acquire the property on equal terms with the buyer.
- Typology
- Classification of a residential property by number of bedrooms (T0, T1, T2...).
- Due diligence
- Prior analysis of a property (legal, value and cost) to decide with information before bidding.