Portugal Unveils New Housing Initiatives

A new housing policy was announced by the Portuguese government as part of the “Mais Habitação” project. This new strategy intends to alleviate Portugal’s housing scarcity challenges and consists of thirty specific measures. The creation of this new initiative is centered on a plan to enhance the availability of homes in Portugal. The ultimate objective is to keep housing accessible and affordable while also enhancing public housing alternatives. It will also aim to streamline bureaucratic procedures.

Focusing on Shortages in Housing Supply and New Construction

The build-to-rent initiatives will be financed by the housing measures. There will be special credit lines available to promote the construction of built-to-rent homes in Portugal. As a result, an increase in the availability of rental accommodation is anticipated.

A deal for industrial collaboration will also be present. The Portuguese government aims to enhance construction capacity by fostering strong collaboration with industry players. This initiative includes attracting and educating local personnel, adopting process industrialization, and promoting stable manufacturing processes.

There would be a reduction in VAT on building and rehabilitation. The current legislative session is almost over. Value Added Tax (VAT) on authorized construction and repair projects will be 6% till the end of the project. There will be price caps on them as well.

Increasing the Options for Public Housing

The terms of municipal obligation will be shortened by the government. The objective is to expedite the distribution of 25,000 housing units now covered under the Recovery and Resilience Plan (PRR).

The government intends to increase IHRU’s capability as well. The Housing and Urban Rehabilitation Institute (IHRU) will have more promotional power. Eventually, it will make it possible for more public building initiatives to be funded under the Affordable Rental Program.

Rental Market: Gaining Back Trust and Boosting Investment

Investment contracts for ready-to-let and build-to-rent homes will also be available. The purpose of the particular contracts is to increase investment in properties that are available for rental and those that are built to be rented. It will ultimately lead to a longer-term rental market that is more stable.

Protecting landlords and tenants will be the government’s next priority. This phase will involve assuming the position of the landlord and providing rent subsidies for a maximum of three months in the event that the tenant defaults. Furthermore, the intended legislative changes would seek to restore flexibility and confidence in the Urban Rental Regime.

The “Extraordinary Contribution to Local Accommodation” program, known as CEAL, will end. Additionally, the initiative will decentralize and streamline municipal lodging standards. Moreover, modifications will be made to the aging coefficient, transferability, and license expiration.

Cutting Down on Red Tape to Accelerate Development

The Urbanistic Simplex Program aims to reduce bureaucracy associated with construction and urban planning. Because the licensing process is accelerated, real estate development will be more effective.

BIM will be used by municipalities for licensing since it speeds up the building process.

Portugal’s Upcoming Prospects for Real Estate Investors

For Portuguese real estate investors, these measures primarily provide exciting new options. Among the potential prospects are long-term rental schemes, restoration projects, and new building dwellings. In actuality, the initiative represents a substantial shift toward a more dynamic and inclusive Portuguese housing market. It develops a thorough strategy and seeks to resolve the existing housing issue, improving the climate for real estate investment. In doing so, it simultaneously encourages long-term economic growth.