You agreed on €450,000.
The bank's appraiser says €390,000.
Your mortgage just changed.You agreed on €450,000.
The bank's appraiser says €390,000.
Your mortgage just changed.
Portuguese banks appraise independently of the agreed purchase price — and they often come in lower. PropCheck estimates what the bank's valuation is likely to be before you apply, so there are no surprises after you've signed a deposit contract.
Portuguese banks conduct an independent property appraisal before issuing a mortgage. The appraisal uses a methodology based on Banco de Portugal guidelines — comparable registered transactions, construction cost methods, and a conservative adjustment for market conditions. If the bank's appraisal comes in below the purchase price, your LTV is calculated on the appraisal value, not the price — which reduces your mortgage and increases the cash you need at completion. PropCheck estimates the likely appraisal value before you commit to a CPCV.
The risk is specific and predictable: you sign a CPCV (Contrato de Promessa de Compra e Venda), paying a deposit of typically 10–20%. The deposit is non-returnable if you withdraw without a valid reason. Your mortgage application is submitted. The bank's appraiser — who follows BdP-mandated methodology — values the property at €390,000 against your agreed price of €450,000. Your mortgage offer drops from €360,000 to €312,000 (80% LTV on the appraisal). You need to find an additional €48,000 in cash to complete, or you walk away — and lose your deposit.
This scenario plays out routinely in Portugal's current market, where asking prices have outpaced the conservative methodology banks are required to use. Knowing the likely appraisal value in advance lets you either negotiate the purchase price, confirm you have the liquidity buffer, or make the CPCV conditional on financing (condição suspensiva de financiamento).
How Portuguese banks appraise property
- Comparable method — The primary valuation method, using AT registered transactions for comparable properties in the same area over the past 24 months. Banks use a more conservative comparable set than PropCheck's Fair Price Score — they exclude outlier transactions and apply a market adjustment factor.
- Income method — For investment properties, the bank may also apply an income capitalisation approach based on gross rental yield in the area.
- LTV limits — Banco de Portugal macroprudential rules cap LTV at 90% for primary residence (habitual residence) purchases and 80% for all other purchases. These are hard regulatory ceilings — Portuguese banks cannot lend above them.
- Floor: higher of appraisal or purchase price for LTV — LTV is calculated on the lower of the appraisal value and the purchase price. If the purchase price is lower than the appraisal, the LTV uses the purchase price. If the appraisal is lower — which is the risk scenario — LTV uses the appraisal.
Sample output — €450,000 purchase, primary residence, 80% mortgage requested
Frequently asked questions
Know the bank's number before you pay a deposit.
Estimate what the bank's appraiser will value the property at — before the CPCV is signed and the deposit is at risk.