While the government is rolling out the red carpet for young Portuguese buyers, they are tightening the rules for international investors. The 2025/2026 State Budget introduced a significant shift in how IMT (Property Transfer Tax) is calculated for Non-Residents . The Property Tax "Flat Rate" Shock Previously, if you bought a holiday home in the Algarve, you paid tax on a progressive scale—just like a resident. A cheaper apartment meant a lower tax rate (often around 2-3%).