MARKET STATUS
The Bank of Portugal revised (upwards) the GDP growth by 8 tenths more than in December (1%), this downward revision of rates is due to an expected moderation in investment due to the continuous increase in finacing costs. They also estimate a slight improvement for exports of goods and services. With regard to inflation, this is revised downwards (from 5.8% to 5.5%) for 2023 and 3.2% for 2024, approaching the target of 2% in 2025.
The year 2022 ends with a deficit of 0.4% (ine, provisional data). The growth of the economy and the increase in tax revenue is largely due to the inflation, the main responsible for this result. For 2023 the forecast is 0.9%.
The impact of the inflation is visible in the household savings rate, which stood at 6.1% of their disposable income, down from 9.9% in 2021. There is a higher growth in consumption than in income.
In the financial markets, the FED and the ECB continue their program to control the inflation by raising the reference rates.
Added now the seemingly solved problem of liquidity in the banking system. The solution of imposing losses on holders of contingent convertible bonds, higher than those of holders of shares, in the purchase of Credit Suisse by UBS, generated fear among investors in relation to the appreciation of such assets and other instruments of the banking sector, and doubts remain about the viability of some regional banks in the US. With all this, it seems that the cycle of rate hikes is coming to an end, or there will be smoother increases. The pillar of trust is once again affected, and it’s natural for some investors to increasingly seek alternative investments.
The “more housing” package program was approved, with the following measures highlighted:
- Limitations on the increase in rent for new contracts.
The initial rental value of new contracts for houses that have been on the rental market in the last five years cannot exceed 2% compared to the previous one. To this value can be added the automatic update coefficients of the three previous years (if they have not been applied), considering 5.43% in relation to 2023.
- Old rents updated for inflation
Old lease contracts (prior to 1990) that have not been transferred to the New Urban Lease Regime (NRAU) will now be updated according to inflation and benefit from IRS and IMI exemption. Payment of compensation to landlords is also foreseen.
- Suspension of new AL (local accommodation) licenses and expiry of registrations
Issuance of new local accommodation licenses will be suspended until December 31, 2030, with the exception of areas for rural accommodation. Registrations issued on the date of entry into force of the new rules expire on December 31, 2030, being renewable for five years thereafter. This forfeiture does not apply in situations where AL establishments "constitute a real guarantee of loan agreements entered into on a date prior to the entry into force of this law", if the loan is not fully paid on December 31, 2030.
- Owners of units in the same building can oppose the AL
Owners can oppose the AL, if that’s the decision of more than half of the permil of the building. Such non-opposition cannot be verified if the constructive title provides for such use (AL).
- Extraordinary contribution to the AL
Local accommodation will now pay an extraordinary contribution whose taxable base is constituted by the application of an economic coefficient (which takes into account the area of the property and income) and urban pressure. The rate applicable to this tax base is 35%.
The taxable property value (VPT) for the purposes of IMI of houses in local accommodation is always equal to 1, no longer benefiting from the reduction in the aging coefficient that accompanies the age of the property.
- Tenants can notify the tax authorities of the lease
Tenants will now be able to notify the tax authorities of lease contracts, subleases, promises and respective amendments or termination, if the landlord fails to do so.
- Reduction from 28% to 25% of the special IRS rate on rents
Income from rents (when the taxpayer claim autonomous taxation) will now pay an IRS rate of 25%, instead of the current 28%. In addition, the reduction in the tax rate that already exists for contracts of longer duration is also reduced, and in the longer term (over 20 years) it drops from the current 10% to 5%, ending, however, for those of duration between two and five years.
- End of “golden visa” program
The “Golden visa” will no longer be granted for the acquisition of real estate, with the Government's proposal to make adjustments to the renewal (every two years) of those already allocated, providing, in particular, that this only happens if the property is used as a private residence and permanent property of the owner or descendant or if it’s placed on the rental market for a period of not less than five years.
- Changing commercial properties and services into housing
The possibility of automatically changing the use of commercial properties or services into residential properties is envisaged, eliminating the need to review land use plans or housing licenses, provided that is under the “controlled costs” program.
Sources: INE, BdP, BPI research, Lusa, Council of Ministers
DEVELOPED ACTIVITIES
i. Current Management
ii. ACHIEVEMENTS
Another project was closed: Pêra Marginal
Pêra
Marginal
Capital 108.300€ | 16 Membros
iii. Improvements and Evolutions
MONTH'S
SCHEDULE
April 2023
