2023 State Budget: Changes in the Landlords status

As of next year, landlords will only be able to request up to two months' rent in advance, a limit that is lower than the one currently defined by the law. Tenants' representatives support the positive change but have concerns about the risk of it being ineffective, considering that the existing limit is often not complied with.

This change results from an amendment to the 2023 State Budget presented by Bloco de Esquerda (BE), which was approved last week during the parliament discussion on the proposal. According to the amendment, "the payment of the rent may be anticipated, with a written agreement, for a period not exceeding two months”. At the same time, "the parties may guarantee, by any of the legally foreseen means, the fulfilment of the respective obligations, up to the value corresponding to two months’ rents".

This proposal amends what is currently defined in the Civil Code, which determines that the payment of the rent may be advanced for a period of up to three months and that landlords may require a deposit without limits on the amount.

The amendment proposed by the BE and approved with the votes of the BE, Socialist Party (PS), Portuguese Communist Party (PCP), Livre and PAN, also aims to prevent the “abuse” of the deposits requested by landlords to conclude lease contracts. The document reads "The amount demanded in advance for rentals and deposits make it impossible for many people to access rents and it is a disproportionate requirement that urgently needs to be corrected, limiting the amounts that can be requested to guarantee the execution of a lease contract”.

The Lisbon Association of Tenants (AIL) understands this as a "positive" measure, which will "benefit, above all, people on lower incomes, who cannot pay more than two months’ rent in advance". However, he also referred "this is a measure that may not have much practical effect", bearing in mind that the current law already imposes limits on the advance payment of rents, which is now of three months and, in many cases, is not complied with.

The proposal now approved will, even so, safeguard this disrespect for the law, since, besides the new limit for the advance payment of rents, it is also imposed that, if a deposit is required, it cannot exceed an amount equivalent to two months’ rents, a rule that didn’t exist in the current law, which has no limit in what concerns the collection of deposits.

Source: Público