No “silver bullet” for “complex” housing problem says minister

Portugal’s Secretary of State for Housing, Patrícia Gonçalves, has admitted that the country’s housing crisis is “a complex problem” and requires “many policies to converge” to provide a robust response to solve the issue.

Speaking at the opening of the 12th Lisbon Urban Rehabilitation Week, the Secretary of State highlighted the importance of the event to talk about the city “because it is vital to have this time of knowledge sharing, (important) for taking any decision.”

She said, according to business title Eco and property magazine Vida Imobiliária that it had been within this strategy of discussion that the government ’s policy Build Portugal’ (Construir Portugal) was designed to consolidate a public housing policy”.

“It is important that we are aware that a house alone does not solve any housing problem; the neighborhood has to be inserted into the city and the habitat. This introduces the concept of dignity, and that is what we are looking for”, she stressed, adding that “Construir Portugal’ was based on multidisciplinary knowledge and the collaboration of all the players working together”.

The Secretary of State for Housing recalled that in recent years, the sector has faced structural challenges: “the value of real estate has skyrocketed since 2015, costs have increased since 2020, there is a labour shortage and a lack housing. We have 1.5 million people in this situation and a middle class unable to access the private market, with a very different profile from the vulnerable class of a few years ago”, said Patrícia Gonçalves.

To build a public housing policy, Patrícia Gonçalves Costa highlighted five fundamental axes. The first involved the “removal of regulation blocks”, which included the revision of the land use regime or Land Law, with a final decision to be taken “tomorrow” (Wednesday February 26), and an amendment to the RJIGT, which provides for «70% of this construction as housing with a price limit and 30% for free market or related uses». He also highlighted the importance of the revision of the RJUE (Legal Regime for Territorial Management Instruments), planned for the first quarter of this year, and the development of a Building Code.

The second axis was mobilising public resources through partnerships to provide a new use for empty State-owned buildings which will be turned over to municipal councils, and the third axis has to do with money earmarked for housing from Portugal’s Recovery and Resilience Programme and the programmed 1st Right which has been recently approved.

Other support instruments included property and stamp duty tax exemptions, the revised Porta Jovem 65 to provide rental accommodation for young people aged 35 or under, as well as the ongoing pledge to reduce VAT on residential housing construction.

The Secretary of State said there was “no silver bullet” to solve Portugal’s housing problem which was “complex” and required “many policies to come together” to create a public housing policy.

Lisbon Mayor Carlos Moedas pointed out that three years ago there had been 3,000 planning approvals for projects at a standstill. “Since then we have approved more than 10,000 homes, around 3,000 per year, an increase of 20% on the past”.

He also said the city council was doing up properties that had been “shut up” handing out 30 keys to new tenants every 15 days – 2,435 keys so far – providing homes that were not built from scratch but rather involved 1,800 existing buildings that had been done up for housing.

However, local municipal councils have criticised a reduction in the powers of the Urban Rehabilitation Housing Institute (IHRU) which has been charged with the management of funds from the Portugal RRP funds for housing, saying it runs the risk of a return to clandestine building as a result of Portugal’s housing crisis.