NEW LIFETIME LEASE IN PORTUGAL

On 14 February 2019, the Portuguese Council of Ministers approved a decree-law creating a real right to sustainable housing (Direito Real de Habitação Duradoura or DRHD).

This programme aims to provide households with a stable housing solution. By enabling them to keep a home as their main residence throughout their lives. In return for paying the landlord a deposit and rent each month for the duration of the contract.

This is one of the decrees approved as part of the new generation of housing policies.

Real right to sustainable housing (DRHD)

Thanks to this measure, the beneficiary of the HDRD (the tenant) has the right to live in a single dwelling for the rest of his or her life. While still being able to cancel the contract. The need to go into debt to buy a property is reduced. All or part of the deposit can be paid out, depending on the length of the stay in the property. The HDRD can also be mortgaged if credit is needed to pay the deposit. Explains the Portuguese government in a press release.

The ownerThe new company will have more capital at its disposal, without having to sell any of its assets. At the same time, it will benefit from "stable profitability" and a "reduction in asset management costs". In addition, "the risk of non-payment is reduced thanks to the security deposit", says the executive.

According to João Pedro Matos Fernandes, Minister for the Environment and Energy Transition. The deposit to be paid should be "between 10% and 20% of the value of the property"..

Accessible rental programme

Another piece of legislation adopted by the Council of Ministers as part of the NGPH is the Accessible Lettings Programme. The aim of this programme is to promote, on a voluntary basis, a wide range of homes for rent at reduced prices. In line with household income.

According to the Portuguese government, the aim of the AAP is to meet the housing needs of households whose income does not allow them to access housing adapted to their needs. The aim of the measure is "to encourage the supply of low-cost rental accommodation". At the same time, it will improve "the attractiveness, security and stability of the sector".

Increase in IMI tax on vacant homes

The decree-law increasing municipal property tax (Imposto Municipal sobre Imóveisor IMI) on vacant homes in areas of high urban pressure has also been adopted. It therefore gives local authorities the option of increasing the current rate of IMI for these properties.

" The measure introduces the concept of an urban pressure zone. These are areas where access to housing is very difficult. Either because the supply of housing is scarce or insufficient, or because the value of this supply is higher than that affordable by the majority of households. Without their housing costs being disproportionately high in relation to their income". states the Council of Ministers press release.