The second barometer of the Lisbon Owners’ Association (ALP), this time measuring the confidence level for the year 2021, showed a sector that was badly affected by fears of an increase in rent losses. More than half (51.4%) of respondents said they did not trust the market because they believed the level of non-compliance will increase. Almost 40% of the contact persons are already affected by arrears.
In a statement sent to the newsrooms this Wednesday, the ALP states that almost 40% of those surveyed (38.7%) report residues (residential and non-residential). The ALP Barometer was carried out on an online platform in January 2021, collecting contributions from three hundred owners. Of the backward owners, more than a third (36.5%) accumulate losses of three to six months’ rent and a further third (33.9%) between two and three missing rents. A part of 18.3% of the respondents is more than half a year (six months) behind.
Nevertheless, 65% of the surveyed owners do not intend to initiate an eviction process and among them 40% say they do not do so in order to “understand the social and economic fragility of the tenants and to show solidarity with them”. And 38.9% of those questioned point to “the slowness of the judiciary in order not to enforce their rights enshrined in the treaty before the competent courts”.
The answer to the question to the owners whether they wanted to place a vacant property on the rental market in 2021 or not is very revealing for the distrust of the rental market. A share of 43.9% answered yes, but 16.4% of respondents said they intend to keep their property vacant and many others said they intend to give up the lease and sell their property.
Of those who claim to continue their bet in the rental market, a large majority (77.3%) say they will leave their rental rates unchanged. Only 10% of the sample intend to lower the income values to be practiced, while a proportion of 12% is even considering an increase.
Affordable rent is not convincing
The great majority of the surveyed owners are not convinced by the favorable rental programs of the government and local authorities. According to the results reported by the ALP, almost 90% of the respondents state that they do not trust these programs and that they are not “available to place their properties [neste segmento]despite the attractive tax incentives, ”says the ALP. In fact, only 4.8% of respondents said they have accessible leasing properties.
Properties included in the accessible lease benefit from income tax exemptions and, if included in municipal programs (such as those in Lisbon, Porto and Matosinhos), the IMI exemption. The counterpart is to be invoiced for the administrative rents set for a period of five years. “The distrust of the state, the government and the autarkies, the volatility of the laws and the fear that the rules will change during the contracts, the bureaucracy and the very long duration of the leases are the reasons why they do not think about it stick to this mechanism in 2021, ”says the ALP.
The vast majority (74.4%) of owners who participated in the ALP Barometer disagree with the government’s measures and changes to the lease in the context of the Covid-19 pandemic. At this point, more than a third (37.2%) of owners feel they feel ill-informed and have difficulty keeping up with the changes being introduced. And 50.9% say they have doubts, but know generically enough about the matter.
As suggestions for alternative measures to the adopted ones, the owners signal on an open question that “the government should have assumed its social responsibility by providing subsidies to tenants with financial difficulties caused by the pandemic” and “a more balanced stance between both parties – landlord and tenant, in particular with regard to the extension of losses to landlords by suspending evictions and the effects of objecting to the extension of leases. “
The loss of confidence of the owners will be felt in the urban redevelopment. More than half (59.2%) will not carry out any renovation work on their properties. Financial unavailability is the reason given by 30.3% of those surveyed, while a quarter (25.7%) of the sample cites market uncertainty as the reason.
“The data of the present study, which was carried out by the ALP, clearly shows the enormous effects that the successive changes to the rental law and the measures approved due to the Covid-19 pandemic had on the functioning of the rental market and on the confidence of the owners Market “, says Luís Menezes Leitão, President of the ALP, quoted in this statement.
The president of ALP, who is also president of the bar, argues that there is a need “to quickly reverse the policies implemented in recent years” and that this will be the “only way to increase rental supply”. So that the Portuguese housing law can be implemented “, warns Menezes Leitão.” ALP believes in the resilience of the real estate market in 2021, especially in the rental segment, whose demand continues to significantly exceed existing supply. “says Menezes Piglet.
The Lisbon Owners’ Association claims to have constant communication with tenants in a situation of economic hardship due to the pandemic and informs them of the facility provided by the IHRU – Institute for Housing and Urban Rehabilitation – that extends the granting of interest Has. Free loan to pay the rent until July 1st, 2021.