Mais Habitação’s package of measures was approved this Wednesday in a general final vote in parliament, with only the votes of the PS. PAN and Livre abstained and the other parties voted against.

The opposition parties called for a plenary vote on several of the proposed amendments they had tabled – which failed in the specialty – after strongly criticizing the PS bench, albeit for different reasons, when presenting the respective requests.

For the PS, deputy Maria Begonha underlined that “between the left in which the entire rental market should be controlled” and the perspective of the right “no consensus is possible”.

The presentation of the recall requests and the votes were supervised in the galleries by people dressed in black jerseys, coupled with the local accommodation, who left just as the parties rose to vote against the proposal of the government of Mais Habitação , slapping their feet as they left the premises, prompting the President of the Assembly of the Republic to interrupt the vote until they left and the noise ceased.

What does the Housing Package contain point by point?

Local accommodation

The extraordinary Local Accommodation (AL) contribution of 15% will always advance, still lower than the government’s initial proposed contribution of 35% and later of 20%. This fee only applies to apartments or lodging establishments in self-governing fractions, excluding homes and properties dedicated entirely to LA. Exempt are also persons who use their own permanent home for a maximum of 120 days per year. New registrations in the form of apartments or houses are now prohibited throughout the national territory, except in the interior. In addition, new permits in buildings intended for housing will have to have the prior consent of all owners, that is, the vote must be unanimous.

Rent limit

The rents of new leases for properties that have been on the market for the past five years will not be able to increase by more than 2%, unless the respective discount coefficients are not applied. In these cases, the coefficients of the previous three years can be added to the value, assuming 5.43% compared to 2023. This tenant protection measure is only imposed for contracts that exceed the general rent limits per type. With regard to properties subject to extensive renovation or restoration works, duly certified by the City Council, the amount of the corresponding costs borne by the landlord may be added to the initial rent of new leases, up to an annual limit of 15% .

less taxes

On the other hand, landlords will be compensated with a tax credit, based on IRS or IRC on property income, in case of natural or legal person respectively. For example, the current maximum general rate of 28% for contracts up to and including two years and 26% for a term between two and five years will be reduced to 25%. Income from contracts between five and ten years is now taxed at 15% instead of 23%. For maturities between 10 and 20 years, the rate is reduced from 14% to 10%. If the lease term is longer than 20 years, taxes are reduced from 10% to 5%. In addition, there will be an extra discount for those who reduce rents. In practice, there will be a reduction of five percentage points in the rate to be applied to property income, provided that in a new contract, with a minimum of five years, covering the same property, the rent is reduced by at least 5% compared to the practical value. To prevent abuse, contracts whose rent is at least 50% higher than the maximum limits set in the affordable leasing program are excluded from these tax benefits.

trusted IMI

On the proposal of the PSD, exemption from municipal property tax (IMI) was approved for large families, the so-called family IMI. Therefore, if there is a dependent person, the fixed deduction increases from 20 to 30 euros. With two children, the discount increases from 40 to 70 euros. A family with three or more offspring can enjoy a double discount, from 70 to 140 euros. The allocation of this deduction to the OZB own and permanent residence depends on the decision of the municipality and is reported annually to the Tax and Customs Administration.

tax incentive

Owners who withdraw their home from the AL by the end of 2024 and place it on a residential lease are exempt from paying IRS or IRC on real estate income until the end of 2029. However, only landlords with AL licenses can take advantage of this measure before December 31, 2022 and for leases concluded until the end of next year. On the other hand, the capital gains exemption was approved, based on IRS and IRC, on homes sold to the state. This benefit does not apply to residences owned by residents in so-called tax havens or to profits arising from sales through the exercise of pre-emptive rights.

forced rent

In fact, the forced lease of properties that have been vacant for more than two years and that are outside the interior territory will continue, but with some extenuating circumstances. The wording approved by the Members underlines that this tool can only be used in exceptional cases and that the tax penalty falls on municipalities that do not want to continue with the forced lease, so that they can continue to apply aggravated IMI rates in this way .

Golden visa

The New Investment Residence Permits (ARI), or Golden Visas, only end for investment in housing, which does not affect the ability to renew permits already granted. Applications for concessions and renewals for investment activities remain valid, including those that are awaiting preliminary control procedures in municipal councils on the date of entry into force of the law. The granting or extension of residence permits for family reunification is also excluded from the established restriction. The government’s original proposal allowed new Golden Visas for investment or support for artistic production and restoration or maintenance of the national cultural heritage, but the PS, the party that supports the parliamentary majority, proposed as a specialty to abolish this exception .