Mitigating the Impact of Rent Increases in 2024

Mitigating the Impact of Rent Increases in 2024

Portugal is grappling with a political crisis following the resignation of António Costa, sparking uncertainties regarding the rise in rents in 2024. The President of the Republic has decided to promulgate government measures aimed at lessening the impact, allowing for a rent increase of up to 6.94%. The reinforcement of extraordinary support to families has also been approved, with an automatic addition of 4.94% to the monthly rent. Tenants with effort rates above 35% will benefit from this initiative.

Furthermore, in a move to address the challenges posed by the anticipated rent hike in 2024, the government has approved a measure that automatically adjusts extraordinary rent support by an additional 4.94% of the monthly rent. This reinforcement will be granted even if it surpasses the current maximum support amount (which is 200 euros). This measure specifically targets tenants with incomes up to the 6th IRS bracket and effort rates exceeding 35%.

Additionally, tenants currently not receiving extraordinary rent support but foresee their effort rate surpassing 35% with the anticipated update in 2024 can, through application, request to be covered by the measure, provided their lease was established by March 15, 2023.

In practical terms, a rental contract of 700 euros will increase to 748.58 euros monthly in 2024 due to the inflation-based adjustment. In the case of a 900 euros contract, the increase will amount to 62.46 euros.

Another support outlined in this matter is the deduction limit for rents in the IRS, which will rise from the current 502 euros to 550 euros in 2024. This measure is universally applicable, benefiting all tenants with lease agreements. As the approval of OE2024 is guaranteed by the absolute majority of the PS, this measure is likely to move forward, providing significant financial relief to many families.

The government is committed to finding equitable solutions to address the housing challenges stemming from the current political situation, ensuring Portuguese families can maintain stability and well-being amidst these changes.