Hugo Santos Ferreira considers that the gross tax burden is, together with licensing, the main causes for the lack of houses in Portugal and calls for an urgent reduction in VAT from 23% to 6%. “The sector is at a standstill waiting for this. We can run the risk of prices galloping,” he says.
Access to housing continues to be the main problem in Portugal for those outside the real estate market. This was one of the main ideas defended by Hugo Santos Ferreira, president of the Portuguese Association of Real Estate Developers and Investors (APPII) in the ‘Special Report – Real Estate Challenges in 2024’, organized by Jornal Económico and taking place this Tuesday, 30th April, in Lisbon.
“There is an imbalance between supply and demand. Housing has become a diamond. We cannot continue to be a poor country with rich tics. We build less and less. In the 90s we built 100 to 120 thousand houses, now less than 10 thousand. We built 15% fewer homes this decade compared to the previous one,” he stated, highlighting the need to lower VAT and end AIMI.
“We don’t have housing in our country because of the gross tax burden. Housing is the only essential good that has not yet seen VAT reduced. AIMI is the biggest fiscal aberration in our country. Why not associate the revenue from attracting foreign investment and associate it with social security”, he highlighted.
Adding to this problem are low wages, which for the developer leader have never kept up with real estate appreciation and mobility. “The housing problem is essentially a problem in metropolitan areas and is becoming more acute in Lisbon and Porto. Nobody wants to live outside city centers, because it’s hell to get into city centers,” he highlighted.
One of the themes that marked the last year for the leader of APPII was the lack of confidence that affected investors. “There was an open attack on promoters and investors. There is a lack of trust in tenancy law, which is the most unstable law in our country. Owners fear every time a new state budget comes out. We need a balanced law”, he highlighted.
As such, Hugo Santos Ferreira defends essential measures to implement in the market now. Immediately lower VAT from 23% to 6% in construction. “We are one of the few countries in Europe that have VAT at 23%. The sector is at a standstill waiting for this. We can run the risk if it takes much longer for prices to gallop and for houses to take much longer,” he said.
Licensing, which, in the opinion of the leader of APPII, is, along with the tax burden, largely responsible for there being no houses in Portugal. “A simple T2 in Lisbon that is locked up in the city council for three years is another 100 thousand euros that the Portuguese pay. The sector is waiting to build houses that the Portuguese can afford. The time is right for us to quickly implement these measures,” he highlighted.
Tags: Housing diamond country continue poor rich tics argues leader promoters
