measures for housing

The Prime Minister presented new measures for the housing problem in the country. Stay up to date with all the details.

The Council of Ministers today approved a set of measures to solve the housing problem in Portugal. At the press conference that followed, António Costa, Fernando Medina and the new Housing Minister, Mariana Gonçalves, presented these same measures to the country which, according to the Prime Minister, are based on five axes.

The measures presented by the Government for Housing

In this regard, the Prime Minister presents two measures: allowing land licensed for commercial activities and services to be converted into housing. And this without altering the land use plan or housing license.

In addition to this measure, the State will make available land or buildings under the housing development contract regime for projects at affordable costs. Cooperatives and private companies will be able to compete for the foreseen tenders.

In order to simplify licensing processes and respond to criticism from promoters about the length of licensing processes and the respective costs, the Government also presents two measures:

• Licensing with a term of responsibility signed by the designers and whoever fails to comply will be subject to a “very tough” sanctioning framework.
• Penalize public entities with default interest (for the benefit of the promoter) for non-compliance with licensing deadlines. In this regard, Costa clarifies that if the Municipality is responsible for the delay, for example, the State Budget will deduct what was paid in default interest from the Municipality’s current budget.

For this axis, the Government wants to gain the “landlords’ trust” so that they put vacant houses on the market. For that, the The State will lease the houses to these landlords for a period of five years, to then sublease. “We are committed to paying the rent in advance”, says António Costa.

The state will still guarantee payment after three months of default. The Prime Minister explains that for all eviction requests submitted to the National Lease Desk after three months of non-compliance, the State will replace the tenant.

O State will be, moreover, tenant and landlord at the same time. When necessary, it will seek to find out the reasons for non-compliance and respond to the situation. If it is just a matter of a “professional defaulter, of which there are also”, as stated by Costa, then the eviction will be incumbent upon the State.

For the fourth axis, António Costa guarantees the owners exemption from capital gains tax on sales of real estate to the State or municipalities. These houses, he explains, will then be placed by the State on affordable leases.

In addition, owners who allocate their properties to the affordable lease regime (or purchase properties for this purpose) will not pay IMT. Rehabilitation works will also have 6% VAT and whoever has the houses on affordable lease will benefit from exemption from IMI and total exemption from IRS on these incomes.

Finally, the Prime Minister refers that the State will finance the Municipalities through a credit line of 150 million euros to coercive works, so that they can introduce housing that is off the market. A mechanism, by the way, that has existed for many years, but of rare applicability due to lack of budget, explains Costa.

On the other hand, the State will encourage the transfer to housing of housing fractions dedicated to local housing. António Costa stresses that new local accommodation licenses will be prohibited, with the exception of licenses for rural accommodation in places where there is no urban pressure.

In addition, from February 2023 until the end of 2024, local accommodation owners will be allowed to transfer their properties to housing rentals. If they do, they will have tax benefits: exemption from zero taxation of property income at the IRS until 2030.