The realm of housing in Portugal is undergoing significant shifts, with the Prime Minister highlighting housing as a personal "frustration" in an interview. Thus, it's unsurprising that housing emerges as a focal point in the proposed 2024 State Budget.
1. Emphasis on Housing: The government's emphasis is evident in its focus on rent support, housing credit, and tax benefits. The term "habitação" (housing) has increased its presence in the budgetary document by 61%, appearing 181 times, compared to its 112 mentions for 2023. The 2024 budget is historic as it marks the first time the Ministry of Housing operates independently, boasting its own budget. While the combined budget for the Ministry of Infrastructure and Housing in 2023 was a mere 229 million euros, the allocation for Housing alone in 2024 exceeds 500 million euros.
2. Extraordinary Rent Support: Aimed at families whose effort rate for rent payment surpasses 35%, the government estimates that this measure will benefit approximately 185,000 families. To qualify, one's annual income should not exceed the sixth IRS bracket, capped at 27,146 euros annually. This support is intended for families with lease agreements signed before March 15, 2015, potentially providing up to 200 euros monthly, with a total cost to the state of 250 million euros.
3. Urgent and Temporary National Housing Fund: Targeting individuals at imminent risk of losing housing, this fund addresses those facing exceptional circumstances, like adverse weather conditions. The government's intent is twofold: to promote social inclusion and combat inequalities. With backing from the Recovery and Resilience Plan, the aim is to allocate 2,000 housing units by 2026, half of which will be ready by next year, costing up to 48 million euros.
4. Worker Housing Tax Incentives: This novel proposal aims to exempt social contributions and accelerate tax depreciations related to the provided property. The government intends to grant fiscal benefits to companies that facilitate employee housing. Additionally, employees might be exempt from IRS and social contributions related to housing provision, aligning with the Rent Support Program's limits. This initiative is slated to cost around two million euros.
5. Interest Rate Bonus: Applicable to taxpayers with their primary residence, earning up to the sixth IRS bracket (27,146 euros), possessing financial assets less than 62 IAS (29,786 euros in 2023), and a housing credit effort rate of 3% or higher. The government aims to support 200,000 housing credit contracts, with annual support not exceeding 800 euros per contract, potentially reducing over 66 euros from monthly mortgage payments. This measure's estimated cost stands at 200 million euros.
6. Mortgage Payment Stabilization and Reduction: Aimed at taxpayers with variable or mixed-rate mortgages signed before March 15, 2023, with at least five years of remaining maturity. The government intends to make 800,000 to 900,000 mortgage contracts eligible for this scheme.
7. First Right (Housing Access Support Program): Intended for those living in inadequate housing conditions without the financial means for appropriate housing. The government, using funds from the Recovery and Resilience Plan, aims to benefit 26,000 families by 2026, costing about 330 million euros.
8. Affordable Public Housing Park: This program targets middle-income families, ensuring they have access to affordable housing. The state is set to invest 216 million euros in this initiative.
Other programs like Porta 65 and Porta 65+ continue, catering to the housing needs of the youth and households with income drops.
These measures, combined with others from the "Mais Habitação" package, showcase the government's commitment to addressing housing challenges, ensuring that more citizens can access decent housing in Portugal. The 2024 budget reveals a proactive approach to these challenges, with a significant allocation of resources aimed at creating more inclusive housing prospects.
You may also like to read:
Understanding Recent Updates to Housing Loans: Your Essential Guide (September 2023) (urbamarkt.com)
Impact of New Legislation (Mais Habitação) on Portuguese Short-Term Rentals (urbamarkt.com)
Renting vs. Buying Property in Portugal (urbamarkt.com)
1. Emphasis on Housing: The government's emphasis is evident in its focus on rent support, housing credit, and tax benefits. The term "habitação" (housing) has increased its presence in the budgetary document by 61%, appearing 181 times, compared to its 112 mentions for 2023. The 2024 budget is historic as it marks the first time the Ministry of Housing operates independently, boasting its own budget. While the combined budget for the Ministry of Infrastructure and Housing in 2023 was a mere 229 million euros, the allocation for Housing alone in 2024 exceeds 500 million euros.
2. Extraordinary Rent Support: Aimed at families whose effort rate for rent payment surpasses 35%, the government estimates that this measure will benefit approximately 185,000 families. To qualify, one's annual income should not exceed the sixth IRS bracket, capped at 27,146 euros annually. This support is intended for families with lease agreements signed before March 15, 2015, potentially providing up to 200 euros monthly, with a total cost to the state of 250 million euros.
3. Urgent and Temporary National Housing Fund: Targeting individuals at imminent risk of losing housing, this fund addresses those facing exceptional circumstances, like adverse weather conditions. The government's intent is twofold: to promote social inclusion and combat inequalities. With backing from the Recovery and Resilience Plan, the aim is to allocate 2,000 housing units by 2026, half of which will be ready by next year, costing up to 48 million euros.
4. Worker Housing Tax Incentives: This novel proposal aims to exempt social contributions and accelerate tax depreciations related to the provided property. The government intends to grant fiscal benefits to companies that facilitate employee housing. Additionally, employees might be exempt from IRS and social contributions related to housing provision, aligning with the Rent Support Program's limits. This initiative is slated to cost around two million euros.
5. Interest Rate Bonus: Applicable to taxpayers with their primary residence, earning up to the sixth IRS bracket (27,146 euros), possessing financial assets less than 62 IAS (29,786 euros in 2023), and a housing credit effort rate of 3% or higher. The government aims to support 200,000 housing credit contracts, with annual support not exceeding 800 euros per contract, potentially reducing over 66 euros from monthly mortgage payments. This measure's estimated cost stands at 200 million euros.
6. Mortgage Payment Stabilization and Reduction: Aimed at taxpayers with variable or mixed-rate mortgages signed before March 15, 2023, with at least five years of remaining maturity. The government intends to make 800,000 to 900,000 mortgage contracts eligible for this scheme.
7. First Right (Housing Access Support Program): Intended for those living in inadequate housing conditions without the financial means for appropriate housing. The government, using funds from the Recovery and Resilience Plan, aims to benefit 26,000 families by 2026, costing about 330 million euros.
8. Affordable Public Housing Park: This program targets middle-income families, ensuring they have access to affordable housing. The state is set to invest 216 million euros in this initiative.
Other programs like Porta 65 and Porta 65+ continue, catering to the housing needs of the youth and households with income drops.
These measures, combined with others from the "Mais Habitação" package, showcase the government's commitment to addressing housing challenges, ensuring that more citizens can access decent housing in Portugal. The 2024 budget reveals a proactive approach to these challenges, with a significant allocation of resources aimed at creating more inclusive housing prospects.
You may also like to read:
Understanding Recent Updates to Housing Loans: Your Essential Guide (September 2023) (urbamarkt.com)
Impact of New Legislation (Mais Habitação) on Portuguese Short-Term Rentals (urbamarkt.com)
Renting vs. Buying Property in Portugal (urbamarkt.com)
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Marisol Ferreira
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