Rent support schemes extended until December

Rent support schemes extended until December

The Institute of Housing and Urban Rehabilitation (IHRU) is reopening applications. PS facilitates proposals made by BE and PCP.

The extraordinary rent support schemes, created in light of the covid-19 pandemic, will be extended until December. In a debate on the issue today, The Socialist Party (PS) committed to approving the proposal made by the left block to extend the schemes currently in place until the end of the year. 

According to Hugo Costa, coordinator of the socialists in the parliamentary commission on the economy, the PS will facilitate the extension, but want to introduce some provisions in the law in order to guarantee that protection is not given in cases of non-compliance. For example, extension until the end of the year of contracts that have already expired will only be possible for tenants “who are fulfilling their contractual obligations.” In other words, for those who are paying the rent.

            Therefore, until 31st December, a landlord will not be able to terminate either a habitational or non-habitational rent contract, even if the contract has expired, unless the tenant agrees. Means of opposing both habitational and non-habitational contract renewals are also paused, alongside mortgage repayments where the property is the permanent and occupied residence of the owner.

            Another legal measure which the socialists are preparing to approve is the reopening of applications to the IHRU until 31st December 2020, as proposed by the PCP. The opportunity to apply ended on 1st September, but the proposal by the communist bench means that this will now be extended until the end of the year.

            The IHRU programme consists of an interest-free loan to tenants who have suffered at least a 20% loss in earnings due to the covid-19 pandemic. The value of the loan is not based upon the total value of the rent, instead a maximum rate of 35% of the household income is applied (the percentage of earnings which are used to pay the rate), and the IHRU lends the remaining monies needed to meet the monthly payment owed to the landlord.

            Support that began with intention to run until the month following the end of the state of emergency, and which was extended until September, will now again be extended to December. The law stipulates that repayment can begin from January 2021, but also establishes a grace period of six months. This means that, on account of the extension, the start of repayments may only begin in the middle of next year. 

            Meanwhile, the government has also announced that the Programme for Economic and Social Stability (PEES) is to finance grants for rents of families most in need and who cannot meet payments due to expenses. This should require a budget of 1.5 million euros. 

            The PCP’s proposal to extend repayment of the support loans until the end of next year has been discarded.

            Last week, when debating the proposals of the Left Block and the PCP, the PS had already shown willingness to extend these exceptional rent support schemes. On Friday, the two decrees were put down without a vote to work on the issue (where the content of the final text will be clarified). This should begin this Wednesday. 

            Since the deadline stipulated in the current law is due to expire this week, the legislative calendar is rather pressed, given that the decree needs to move past a full and final vote, onto Belem for renewal, and be published in the national official journal. 

            The deadline is worrying members of the Lisbon Tenant’s Association (AIL). “There is not much time [without a new law]; from the 1st October all landlords will be able to request that a tenant leaves,” the president of AIL told DN’s Romão Lavadinho. He highlighted that “the government will be responsible for any evictions that occur.”            Hugo Costa opposes this view, referring to the fact that not only will this legislative process “be much faster than normal,” but also that “the aim will always be to prevent such incidences from happening.”