Costa Wants to Subsidise 170,000 Homes and Reduce Families’ Housing Expenses

4 October 2017

The prime minister said today that the Portuguese government wants to reduce the burden of households’ expenses with housing from 35% to 27% and increase the amount of subsidised housing to more than 170,000 dwellings.

These objectives were outlined by António Costa in a speech that opened Portugal’s Assembly of the Republic’s biweekly debate. The second half of the speech was devoted to housing.

Referring to the main objectives of the decrees approved today in the Council of Ministers, the prime minister stated that he intends to bring Portugal closer to European trends in this area within eight years, mainly by achieving “two goals: reducing the burden of housing expenses on families by lowering their weight on expenditures from 35% to 27%, and increasing the amount of subsidised housing, as compared to the total housing stock, from 2% to 5%, which is equal to an increase of about 170,000 homes.”

According to the prime minister, the decrees, newly approved by the Council of Ministers, will boost “the stock of public housing for those who most need it.”

To achieve this goal, Costa will launch a new program called “Primary Right.”

“The response to this need also includes the need for urgent housing because of unforeseeable or exceptional events, such as catastrophes or collective migrations, and we have already approved the Emergency Housing Support Program – Gateway, which aims to provide adequate and timely financial support in this type of situation,” said António Costa.

Also, according to the prime minister, another goal of the Portuguese federal government is to promote renovations at the expense of the new housing construction.

“The Renovation as a Rule Project was approved, which provides for the revision of construction’s legal framework to adapt it to the requirements and specificities of building renovations. It is also aimed at deepening and articulating the six existing instruments that support investment in renovations, particularly in rental housing,” he said.

The prime minister spoke after measures aimed at the middle-class, more specifically the sector of the population (many of them young) that is being priced out of city centres and their areas of work.

“We will develop an Affordable Rental Program based on the public promotion of housing and incentives for homeowners to place their homes on the affordable rental market. Today, we also adopted the rules for the identification, selection and integration of real estate that is owned by the State and is unused or available as part of the National Fund for Building Renovations, which was created to promote the renovation of real estate for rental at affordable costs,” said the Prime Minister.

In this context, António Costa said that at the beginning of next year the government would approve “a set of incentives for owners to put their homes on the rental market at affordable prices, for a minimum period that guarantees the stability and security of landlords and tenants.”

“Also, instruments will be created to promote security in tenancy, transparency and information on the market and supply,” he said, adding that the measures already adopted will be subject to public debate for the next 60 days.

Regarding the current housing situation in Portugal, especially in the main urban centres, the prime minister said that the “old problems of poor families’ access to affordable housing (which the elimination of the tent problem did not solve) co-exist with new problems that have seen the middle classes and especially the new generations, who have been forced to stay in their parents’ homes, become indebted, or migrate to urban peripheries, forced from city centres.”

“There are no silver bullets that can solve these problems.  They will require concerted action and comprehensive measures targeting different segments of the population and disequilibrium between supply and demand,” he concluded.

Original Story: Sapo24 / MadreMedia / Lusa

Translation: Richard Turner