Buying a share of a building without horizontal property

Buying an undivided share of a building without horizontal property may mean buying a percentage of the whole building rather than a legally independent apartment. That distinction can affect finance, resale, renovation decisions, relations with the other co-owners and the practical case for letting the space. Before making an offer, match the listing against the building documents, establish how the areas are actually used and find out whether horizontal property is feasible, useful and supported by the planning record.

Contents

1. What is actually being sold?
2. Why the actual use of the space can mislead
3. Which documents should be checked before the offer
4. Can horizontal property be created after purchase?
5. How this can affect finance, letting and resale
6. A prudent sequence before signing

What is actually being sold?

In a building under the horizontal property regime, each autonomous unit is independently identifiable and can be sold separately. Lisbon City Council describes the regime as the division of a building into autonomous units, each with its own exit to a common area or the public way, which can be traded independently. Read the municipal guidance on creating or altering horizontal property before treating phrases such as “first floor”, “left-hand flat” or “independent apartment” in a listing as legal descriptions.

Without that regime, the sale may concern an ideal share: for example, 50% or 33.33% of the entire building. There may be an informal arrangement under which each co-owner occupies a different floor, yet that arrangement alone does not turn the floor into an autonomous unit. The title, land-registry record and tax record should describe the asset in the same way.

• Ask for the exact tax and land-registry identification.
• Check whether the reservation contract describes an apartment or an undivided percentage.
• Do not treat a door number, letterbox or separate utility meters as sufficient proof of legal autonomy.

Why the actual use of the space can mislead

A building may have operated for years as though it contained two or three separate apartments: separate doors, kitchens, meters and rent payments by floor. Its physical arrangement still does not replace its legal position. A buyer can inherit a practical arrangement that relies on the cooperation of the other owners.

Ask direct questions: who uses each floor, garage, roof terrace, courtyard and storage area? Is there a written use agreement? Are there shared expenses, pending works or disputes? If the seller says an outside area “belongs” to the advertised space, look for that allocation in the documents rather than inferring it from current use.

This matters particularly if renovation is part of the plan. Works to the roof, façade, stacks, stairs, structure or shared services may cease to be a decision for one owner. For decisions involving shared elements, see our guide to exclusive-use terraces and approvals before works.

Which documents should be checked before the offer

Request documents early, before agreeing a final price or works timetable. The purpose is not to gather paperwork for its own sake; it is to test whether the legal description, built reality and intended use match.

1. Land-registry and tax records: confirm ownership, the percentage being bought, the building description and any registered charges.
2. Acquisition title and any use-division agreement: look for clauses on floors, entrances, expenses and pre-emption rights.
3. Planning documents: request a copy of the use authorisation or licence and the available planning file. In Lisbon, certified copies can be requested, including use licences, housing technical files and horizontal-property inspection records, through the council’s certificate and certified-copy service.
4. Energy certificate: check that one exists and identify the property in the system; ADENE provides an energy certificate search tool.

For buildings within its scope, the housing technical file can bring together information on construction systems and equipment. IMPIC explains when it should be made available to an interested buyer in its Housing Technical File guidance. Its existence does not, however, resolve differences between the advertised area, the use authorisation and the registry record.

Can horizontal property be created after purchase?

It may be possible, but it should never be treated as an automatic step or a certainty already included in the asking price. The units must meet the applicable requirements, and the description of units and common areas needs to be technically coherent. Lisbon City Council provides for certification through an inspection or, depending on the case, through a descriptive memorandum prepared by a qualified professional.

Before buying on that basis, request a specific assessment addressing four points:

• whether the areas, access and services allow autonomous units to be identified;
• whether the authorised use matches the current use of every area;
• whether there are interior alterations, additions or annexes without documentary support;
• whether all co-owners are willing to take part in the process.

Renovation involving walls, access routes or building services can expose inconsistencies that a listing does not show. If you see recent partitions, added doors or altered circulation, read first about assessing unverified interior alterations before making an offer.

How this can affect finance, letting and resale

The issue is not limited to documents. Lenders, future purchasers, valuers and tenants need to understand what is being transferred and which rights accompany the space in use. An undivided share can narrow the pool of future buyers, require further explanation and slow a resale. There is no single lending rule: confirm the specific terms with the lender before assuming finance will work as it would for an autonomous apartment.

For letting, distinguish the space you can deliver on a stable basis from parts of the building that depend on shared access or services. A tenancy agreement does not cure a lack of legal autonomy, nor does it settle a future disagreement between co-owners about works or use of the courtyard.

Include costs that are often absent from the first calculation: document regularisation, design work, municipal fees, meter changes, making-good works, repairs to shared areas and coordination time. A contingency should exist before the offer; it should not rely on future price growth.

A prudent sequence before signing

If the property remains attractive, proceed in stages and put important conditions into the reservation contract. A useful order is:

1. identify the exact object of the purchase and every title holder;
2. compare registry, tax record, use authorisation, available drawings and the observed condition;
3. obtain technical advice on the intended use and renovation scope;
4. confirm funding in advance, where needed;
5. state which documents and regularisation steps the seller must provide, and by when.

Avoid committing because “everyone has their own floor” or “it has always worked this way”. Those statements may describe a routine, yet they do not replace the legal arrangement you are buying. Where renovation is part of the acquisition, a clear record of the existing condition also reduces unforeseen work and supports staged, confirmed payments, as explained in our article on renovation measurement sheets and payment certificates.

Key takeaways

• An undivided share is not automatically equivalent to a legally autonomous apartment.
• Compare registry, tax, use-authorisation, drawing and on-site information before signing.
• Only rely on future horizontal property after checking technical, planning and co-owner conditions.
• Build the time and cost of regularisation into the purchase case without relying on future gains.

If you are considering a purchase for renovation, gather the documents and define the intended scope first. Obra Lisboa can help turn that information into a clear work brief for requesting quotes and planning the intervention with greater control.

Sources and further reading

• creating or altering horizontal property
• certificate and certified-copy service
• Housing Technical File guidance
• energy certificate search tool

Editorial image; it does not depict an Obra Lisboa project.