Buying a home remains one of the biggest challenges for young people in Portugal. Between real estate prices, upfront costs, and bank requirements, coming up with the money needed to take the first step can seem like an almost impossible task. The Public Guarantee for Mortgage Loans was created precisely to help overcome one of the main difficulties: the lack of savings for the down payment.
The good news is that the proposed State Budget for 2027 plans to continue this measure. However, it is important to clarify a key point: as of October 2026, the continuation of this measure for 2027 has not yet been formally finalized. Therefore, anyone thinking about buying a home should keep an eye on official decisions and start preparing now.
What is the Public Guarantee under the Youth Mortgage Program?
The Public Guarantee is a measure through which the government provides a personal guarantee to participating banks, facilitating financing for the first permanent home purchase by young people who meet the legal requirements.
Under normal circumstances, banks generally do not finance the full purchase price of a home. The buyer must have personal funds to cover the difference between the property’s value and the amount financed.
With this measure, the government can guarantee up to 15% of the initially contracted principal, subject to the conditions set forth in the legislation. This mechanism can allow bank financing to reach 100% of the eligible transaction value.
In practice, this represents an opportunity for some young people who have the income to afford a monthly payment but have not yet managed to save the necessary down payment.
It is important, however, to understand that the government guarantee does not mean that the home is given away, nor that the loan is automatically approved. The loan remains subject to risk assessment and approval by the banking institution.
Will the Public Guarantee continue in 2027?
The proposed State Budget for 2027, presented in October 2026, provides for the continuation of support measures for youth housing, including the Public Guarantee.
This indication is relevant for those planning to buy their first home next year, as it demonstrates the intention to maintain programs designed to facilitate young people’s access to housing.
However, there is an important difference between the budget forecast and the final confirmation of eligibility requirements. The formal decision regarding the continuation of the guarantee in 2027 has yet to be confirmed.
Therefore, if you are planning to buy a home, keep three aspects in mind:
Monitor the final approval of the 2027 State Budget and any subsequent government decisions.
Check with participating banks to see if terms and funds are available for new loans.
Do not assume that the deadlines and requirements currently in effect will automatically remain unchanged.
The best strategy is to start preparing for the purchase in advance, without relying solely on the future approval of the measure.
Who is eligible for the Public Guarantee?
The current program is intended for young people who wish to purchase their first permanent home and who meet the legal requirements.
Among the main conditions currently in place are:
Age: be between 18 and 35 years of age, inclusive.
Tax residence: have tax residence in Portugal.
Income: not exceed the limit corresponding to the 8th income bracket of the IRS, under the applicable terms.
Real estate assets: not own an urban residential building or an independent unit within an urban residential building.
Value of the home: the transaction value may not exceed 450,000 euros.
Purpose: the property must be intended as the purchaser’s first, permanent, and primary residence.
Tax status: the applicant must meet the tax and social security compliance requirements established by the program.
There are also specific rules regarding the loan agreement, the financial institution, and other legal conditions.
These are the requirements of the program as currently understood. For purchases planned for 2027, it will be essential to confirm whether these requirements remain in effect and whether any changes have been introduced.
What are the main advantages for those looking to buy a home?
The Public Guarantee can make a significant difference in a young buyer’s financial planning.
1. Lower initial savings requirement
The possibility of obtaining financing for up to 100% of the transaction’s eligible value can reduce the need to save tens of thousands of euros for a down payment.
2. Greater likelihood of completing the purchase
For those with a regular income but who haven’t yet accumulated sufficient savings, this measure can help turn a planned purchase into a concrete possibility.
3. More options for financial planning
With a lower down payment requirement, it may be easier to cover the remaining costs associated with the purchase, provided the family budget allows for it.
4. Support for housing independence
This measure aims to make it easier for young people to buy their first home, creating conditions for them to start a new phase of life with greater independence.
However, each case must be evaluated individually. A large loan amount can also mean a higher monthly payment and a greater long-term financial commitment.
Public Guarantee and IMT Jovem: Are They the Same Thing?
No. Although both measures are related to the purchase of a first home, they have different objectives.
The Public Guarantee seeks to facilitate access to bank credit by reducing the difficulty associated with the down payment.
The Youth Property Transfer Tax (IMT Jovem), on the other hand, provides tax benefits for the purchase of a first permanent home, including exemptions from Property Transfer Tax (IMT) and Stamp Tax within the legally established limits and conditions.
These measures can be complementary, provided the buyer meets the requirements of each.
It is important not to confuse a tax exemption with bank financing: even when benefiting from reduced or exempt taxes, the buyer must be prepared for other expenses, such as a bank appraisal, fees, insurance, and any closing costs.
How to prepare for buying your first home in 2027?
If you want to take advantage of housing support measures for young people, start organizing the process before choosing a property.
1. Make a realistic assessment of your budget. Calculate your monthly net income, fixed expenses, and the amount available to cover your mortgage payment.
2. Consult several banks. Compare offers, interest rates, insurance, fees, loan terms, and approval conditions.
3. Prepare the necessary documentation. Gather proof of income, tax returns, and any other documents that may be required for the credit review.
4. Define your criteria for the home. Set a maximum budget, the areas where you’d like to live, and the essential features of the property.
5. Confirm applicable financial assistance programs. Before making any commitments, verify your eligibility for the Public Guarantee, the IMT Jovem program, and other available benefits.
6. Don’t proceed without understanding the risks. A loan simulation is not the same as bank approval. Before signing a preliminary purchase and sale agreement, make sure you understand the financing terms and the timeframes involved.
Is it worth starting to look for a home on the Silver Coast?
For young people looking to buy a home on the Silver Coast, preparing the process in advance can be especially helpful.
The region offers a variety of property types and locations, ranging from urban centers with amenities and transportation to quieter residential areas and coastal towns.
The key is to find a balance between the purchase price, location, commuting costs, and your family’s needs.
Before making a decision, compare properties, assess their condition, confirm the associated costs, and evaluate whether the estimated monthly payment fits your budget.
The choice of a home should be based on a comprehensive view of the investment, not just on the monthly payment amount shown in a simulation.
Conclusion: Prepare Today for Tomorrow’s Purchase
The proposed 2027 State Budget points toward the continuation of support measures for young homebuyers, including the Public Guarantee. However, the formal confirmation of its implementation next year and the respective conditions should be closely monitored.
For those dreaming of buying their first home, now is the time to get your finances in order, explore credit options, and start looking for opportunities that fit your situation.
With accurate information, planning, and professional guidance, you can make more informed decisions and prepare for your home purchase with greater confidence.
Need help with this topic?
Leila Santos
Real Estate Consultant — MaisConsultores TEAM
📍 Silver Coast
📱 +351 914 930 347
✉️ leilasantos@maisconsultores.pt
🏢 AMI: 23990
👉 Contact me for a no-obligation consultation.