Law No. 56/2023:
After months of anticipation and intense public debate, the decree establishing various measures under the so-called “PACOTE MAIS HABITAÇÃO” was published on 6 October. With these changes, the authorities aim to address the housing challenges in Portugal.
In this publication, we provide a general overview of some key amendments related to the rental sector introduced by this law.
LIMITS ON RENT INCREASES
The initial rent for new residential lease agreements concerning properties that have been subject to lease contracts in the five years prior to 7 October 2023 cannot exceed the last rent charged for the same property, adjusted by a 1.02 coefficient.
This limit only applies to contracts exceeding the general rent limits established under the Affordable Rental Programme (Ordinance No. 176/2019, of 6 June).
Additionally, the automatic rent update coefficients for the past three years may be added to this amount, provided they were not previously applied.
For properties undergoing major renovation or refurbishment, duly certified by the Municipal Council, the initial rent for new lease agreements may be increased to reflect the costs incurred by the landlord, up to an annual limit of 15%.
COMPULSORY RENTAL SCHEME
The law allows municipalities to initiate a compulsory rental process for residential properties that have been vacant for more than two years, provided they are outside designated "interior territories" (as defined in the annex to Ordinance No. 208/2017, of 13 July).
However, certain properties are exempt from this classification, including:
- Holiday homes.
- Properties left vacant because their owner is in a care home or providing permanent informal care.
- Properties owned by emigrants.
- Properties temporarily unoccupied due to professional, health, or educational reasons.
RENTAL OF PROPERTIES BY PUBLIC ENTITIES
Public entities are now permitted to rent properties for the purpose of subletting them to eligible applicants under their affordable housing programmes.
TENANT AND LANDLORD SERVICE DESK (BAS)
A new Tenant and Landlord Service Desk (BAS) has been established within the Directorate-General for Justice Administration. It will be responsible for handling:
- Special eviction procedures.
- Injunctions related to rental matters.
The BAS will have nationwide jurisdiction.
