Chega wants IRS relief on mortgage interest back, PS wants rent deposits kept capped. Both meet the prime minister today
Prime Minister Luís Montenegro is meeting the leaders of the two largest opposition parties, Chega and the Socialist Party (PS), separately today, 5 November, to agree on measures to tackle the housing crisis. The smaller parties will meet him on 6 November (Jornal de Negócios). Both parties want their measures included in the 2027 budget (OE2027), which parliament is now debating article by article.
Chega wants mortgage interest to be deductible from IRS again, up to €1,200 a year. Portugal had this deduction until 2011, when the country received financial assistance from international creditors. The party also proposes raising the IRS deduction for rent paid by tenants by 25% (ECO).
PS is taking five proposals to the prime minister (ECO). The first concerns the government's rental bill, which is already before parliament. Under the bill, the deposit (caução) would no longer be capped (at present it can be no more than two months' rent), and landlords could take three months' rent in advance instead of two. The Socialists want to keep the current limits and give low-income tenants a state rent guarantee. The second is that, until 31 December 2027, tenants who would struggle to find other housing should not lose their homes, even if their contract has expired.
PS also wants to scrap the tax breaks for landlords who let homes at a "moderate" rent of up to €2,300 a month and keep them only for affordable rentals: the money, the party says, should go to people paying €600–700. It proposes handing homes owned by IHRU, the state housing institute, to municipalities for renovation. Finally, owners who sell a second home in an area with a housing shortage for less than €300,000 to a buyer who will live in it would be exempt from capital gains tax for three years. For prices between €300,000 and €500,000 the tax would be lower, and the buyer would not pay stamp duty (imposto do selo) on the purchase or the mortgage.
For now these are only proposals. PS is demanding that the government withdraw the rental bill, while Montenegro is defending it. Which of the proposals become law will be decided by parliament's votes on the budget and the bill.
