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Property Renovation on Madeira Island Portugal


Things are done differently in different countries and it is important to be well-prepared when initiating a project in a new country!

If you are preparing for a renovation or remodeling project, it is a good idea to ask for recommendations for construction workers. It is best to get at least two different quotes in writing from two different groups. You should make sure that the quote includes material and work and importantly, has a timeline of start and delivery. Quotes are usually valid for 30 days.

Some constructors request a payment of 50% ahead of time. We do not recommend paying that amount before they have done any work for you. It is best to agree on payment of a 10% advance so that they can purchase initial material and then pay incrementally as the work progresses. You can prepare a table based on their delivery date and break it down into milestones of time or tasks and pay portions after reaching each milestone. It is also recommended that at least 10% of the payment be made 7-14 days after the final delivery, to make sure that the work is completed as expected. Make all payments via bank transfer upon receipt of invoices that are issued correctly specifying the location where the work was delivered. A bank transfer will give you undeniable proof of payment and will protect you in case you will have problems along the way with the provider. Not receiving an invoice has two major issues. First, you and the supplier both pay VAT added to each invoice. Not receiving an invoice is actually conducive to tax evasion and is against the law and will put you at risk. In addition, if you do not have the correct invoice, you will not be able to claim the investment you make on your property when you are paying taxes on any income that you make from that property.

You must be able to monitor the progress regularly. Often, when the owner or their appointed supervisors do not visit very regularly, the workers tend to leave work and pay attention to other projects, and the work is either postponed or done at poor quality. If you choose a person or company to supervise the progress, make an agreement that includes regular reporting with live video calls, detailed pictures, and reports, and permits you to create some form of accountability.

Unlike some other countries where online reviews can help you choose contractors, in Madeira, you cannot rely on reviews because it is not as common to make online reviews. In addition, many local contractors are not online or known enough for people to make a review about them.

If you meet your contractor or construction manager in person, it is advisable that you do not make oral agreements that require advanced payments. Any time that payment is involved, please make sure there is a quote, an agreement, a bank transfer, and regular follow-ups. There have been unfortunate cases where foreigners were introduced to contractors through the realtor who sold them property and offered to supervise the reconstruction, but the work was left undone while big sums were paid in advance. It is best to be prepared and careful to prevent undesirable situations. Good luck.

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