20% of landlords did not increase rents by 6.94% in 2024

 In News, Property, Real Estate, Rental market, Residential Real Estate

One-fifth of landlords in Portugal’s rental market have not updated their rental contracts by the 6.94% agreed with last government, fearing it would drive their tenants to default or to leave.

This is according to the VII Landlords Confidence Barometer from the Association of Lisbon Landlords (Associação Lisbonense de Proprietários (ALP).
Around a third of those landlords quizzed said they hand’t updated their rental charges because of pre-agreed contracts, while 14% said they would put up rents, but at a different amount because they feared that that if they did add on the 6.94% their tenants would fail to pay the rent.
“Despite being constantly demonised in the ring of public opinion” 10% of these landlords kept the rents the same, while 9% said they didn’t hike rents because they “already had enough income for them to be in a comfortable position” without having to squeeze their tenants for more money.
However, two situations undermined landlord confidence in 2023 says the ALP: the previous government’s ‘More Housing’ package, which led to some landlords selling their rental properties, and an increase in rental payment defaults.
Around 9% of respondents said they had sold their properties that were affected by traditional rental contracts, being unable to charge market values, while another 6% transferred their properties from traditional rental schemes to short-term rentals: students, overseas professionals and digital nomads.
Some 50% said that the real estate rental market was less attractive than it used to be, while 43% thought the market was bureaucratic and difficult to understand, and 29% said that the investment required for operational costs was excessive.
That said, 24% thought it a profitable and secure market in which to invest, yet 23.6% reported cases where tenants got behind on their rents, 30% of which were rents behind by six months and 28% with rents 2-3 months overdue.