FIIAH Legal Framework Set to Lapse in 2020

15 May 2019Richard D. K. Turner

The legal framework governing Rental Housing Real Estate Investment Funds (FIIAH) was in force from between January 1, 2009, and December 31, 2013, covering such funds and the properties acquired by them during the same period. The measure was designed to help banks and Portuguese households during the depths of the financial crisis, allowing mortgage holders to convert their payments into lower rental payments, with the option to buy at any point.

FIIAH will remain in force until December 31, 2020. After that, FIIAHs will automatically convert into Real Estate Investment Funds (FII), subject to the conditions inherent in such. Consumers will have until the end of 2020 to exercise their option to repurchase their property.

The value of the repurchase price is based on the value of the property sold to the FIIAH, updated according to the INE’s consumer price index. The lessee must notify the relevant fund management entity in writing, in cases where they do not intend to exercise their option to buy, and is entitled to receive the amount corresponding to the difference between the value of the future sale of the property and the updated value.

Original Story: Jornal Econômico / Deco

Photo: Cristina Bernardo