Opposition Leader Warns Government's Housing Plan Will Trigger “Spiral Increase” in Rents
The Portuguese government's new housing measures will “provoke a spiral increase” in rents and risk creating an “explosive” social situation, according to José Luís Carneiro, the Secretary-General of the opposition Socialist Party (PS). In a sharp critique of the recently unveiled policy, Carneiro argued that the government's framework, particularly the establishment of a “moderate rent” concept with a ceiling of €2,300, constitutes a new form of market liberalization that will ultimately harm Portuguese families.
“I want, from here, to say one thing to the Prime Minister of this country: the proposals you presented for housing, namely this concept of an average rent of 2,300 euros, will provoke another spiral increase in rental costs,” Carneiro stated during a political event in Vila Nova de Gaia. He contended that such a policy would “severely harm middle-class families, and particularly the youngest people in our country.” He compared the move to the controversial “Cristas law,” a previous legislative act that liberalized the rental market, suggesting the new measures follow a similar and detrimental path.
The socialist leader's comments come as housing costs continue to soar. Carneiro highlighted that “Portugal was one of the OECD countries where housing costs rose the most in the second quarter of this year, rising by more than 17%.” He attributed the “vertiginous” growth in housing costs directly to the policies adopted since the current government assumed office. He warned that the entire housing issue in Portugal “could become an explosive factor” in the nation's collective life if not handled with a different strategy.
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Carneiro argued that the government's focus on demand-side measures, such as providing guarantees for young buyers, is misplaced without a parallel and massive effort to increase supply. “It is necessary for the State to build housing at an accelerated pace,” he insisted, calling for a collaborative effort involving “civil constructors, private agents, cooperatives, associations,” and the national Institute for Housing and Urban Rehabilitation (IHRU). He stressed that the central government must provide municipalities with stronger financial resources to enable them to construct more public and affordable housing.
The opposition's position is that a supply-side crisis cannot be solved with demand-side incentives alone. “Either we manage to put more housing on the market, by working on the supply side, or, by working only on the demand side, we will cause housing costs to grow exponentially,” Carneiro cautioned. He concluded with a stark warning that this approach “will provoke explosive effects in the country's cities,” signaling a period of intense political and social debate over the future of Portugal's housing market.
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