Housing Policy for Portugal | Opinion

The majority of Portuguese people do not have the possibility of accessing the type of housing they need, as purchase or rental prices are higher than what their standard of living allows. Proposals to overcome this situation have been: lower taxes and fees and greater ease in approving projects. These proposals only benefit entrepreneurs and housing promoters, and not users, because if they eventually lower the sale price of housing, which is problematic, it would only facilitate purchases by nationals of more prosperous countries, as has happened so far. . Demand would once again increase the selling price.

Therefore, a profound change in housing policy is necessary.

In the first place, nationals of other countries should not be given greater facilities for the purchase of housing, as is currently the case. They must be, at least, in the same conditions as the Portuguese. These and other extraordinary facilities that have been given to foreigners with a higher standard of living than ours, for example “visas gold” and “digital nomads”, only aim to bring money to Portugal, encourage the construction industry and increase the gross domestic product (GDP), forgetting the damage it is causing to the Portuguese, with the unbearable increase in the cost of housing.

Local accommodation can be included in this group of practices with perverse effects on the lack of housing at prices compatible with the standard of living of the Portuguese and should be limited. It may, however, be a form of temporary accommodation for professions that require travel for limited periods.

Secondly, housing for rent should be promoted in particular. An economic development policy that includes the sale of construction is wrong, as construction is not exportable. To have significance as an export product, sales have to be made to foreigners and the pernicious effect this has on the Portuguese is already known.

With the aim of promoting leasing, the State and municipalities should be prohibited from selling the land they own and should, as much as possible, take advantage of urban or urbanizable land, as well as vacant buildings they own to build rental housing. Leasing allows individuals and families to easily change their place of residence to obtain better working conditions. It allows, for example, changes to places where certain professionals are most needed (teachers, medical and nursing professionals, assistants, etc.).

Own housing should only be the aspiration of those who have completely stabilized their lives or are approaching retirement. For this, the cooperative system can be reactivated, in which people deposit savings to later obtain a fund that allows the purchase of housing at the right time, also benefiting from a loan under special conditions from the State bank.

The leasing value will be fixed for public housing and similar to what is also of interest for the promotion of private leasing. The latter should also benefit from special discounts on fees and taxes. Thus, it can be considered, for example, that the rental value of a new house should allow the total return on investment in 20 years. A house whose construction cost, including the value of the land, is 150,000 euros (cost of building a T3 without luxuries) and considering that only 10 months a year are for return on investment and the remaining two months for maintenance, fees and taxes, a monthly income of 750 euros is obtained.

Construction costs for the rental market will be defined annually by the State, with some margin of fluctuation, taking into account the social stratum for which it is intended. Various levels of quality would be established, without jeopardizing insulation and the need for buildings to use environmentally friendly materials and techniques. These levels could be: affordable housing, medium housing and upper class housing. The distinction would be made mainly through the areas of the interior spaces, facades, patios and patios and the capacity of the infrastructures, which would be reflected in the value of rents.

If necessary, the State and the municipalities will promote the appearance of construction companies to apply construction prices similar to those contained in tables that would be published annually. The lease will always be for an unlimited period, it is assumed intended for permanent housing and its value is increased according to inflation. Deadlines for leasing may be established at the request of the lessee.

In order to increase the public housing promotion, the State must intervene in the private housing market, coercively rehabilitating the buildings that need it and that are not needed by the owners, regardless of the legal situation in which they find themselves, renting them later. The rents will be collected by the State until the investment is recovered with some profit. Upon return, landlords will have to retain tenants.

There will continue to be a free market for housing, which would have no benefit in terms of reducing rates and taxes.

The reduction of bureaucracy is beneficial, without decreasing quality requirements.

Another type of rental housing, in principle only promoted by public entities, is housing for needy families. The rental amount will not depend on the cost of housing but on the family income, for example 20% of the monthly income. Every year the lease value would be updated according to the earned income.

There are other particular types of housing such as, for example, housing for students or for seasonal immigrants. Here comes the possibility of renting rooms, which must be regulated to have some quality.

The proposal does not contradict the Basic Housing Law (Law n.º 83/2019, of September 3) and is part of the existing legislation. It is, however, necessary to regulate some legislation, to make it clearer and more expeditious.

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