Almost a quarter of landlords are faced with non-compliance with their tenants’ rent payments, according to data from the Barometer of the Associação Lisbonense de Proprietários – ALP. At stake are 23.6% of respondents, which leads the association to emphasize that this is a phenomenon that has remained “sustainably high” throughout the seven editions of this survey.
“The biggest change compared to the last six editions is the fact that the share of landlords who have defaulted on rent for more than six months leads globally among those who are suffering losses. In this sample, 30.3% of owners have rent arrears”, indicates the association in a statement, noting that “those who accumulate losses of two to three months of income represent 28% of the responses”.
Despite this worsening of the problem, only 48.7% of the landlords in question are considering moving forward with evicting their tenants, with the majority considering that this “will be [um processo] It will take time and will cost more than the amount owed by the tenants”.
For 18% of owners, “the resolution always goes through extrajudicial means”, but there are 15.6% who show “understanding for the economic and social situation that tenants are going through”. Also noteworthy is the 17% of the sample who “believe that justice always favors tenants, even in cases of flagrant non-compliance” and the 4% of landlords who say “they do not have the means to access justice”.
In this seventh edition of the ALP “Landlord Confidence” Barometer, which surveyed 525 landlords between March 14 and 22, we learned that one in five (21.4% of respondents, to be more precise) did not carry out the annual update of income in 2024 by the legal coefficient of 6.94%. “If it is true that around a third of the respondents did not do so because they had contracted by mutual agreement another annual coefficient in the lease contract, it is worth highlighting the 14% of respondents who responded that they preferred to update the rent in another percentage value, as they understood that the coefficient calculated by the National Statistics Institute (INE) for 2024 could put its tenants in default”, they justify.
Of the landlords who participated in the survey, 10% indicate that they kept their rent unchanged “because they considered that any increase would be unaffordable for the tenants” and there are still 9% who say they did not change their rent “because they currently have an income that allows them to have a comfortable life, without the need to take away purchasing power from tenants”.
The ALP highlights the “lack of confidence in the rental market over the past year, greatly marked by the instability caused by the “More Housing” package”, with 9% of respondents reporting that they sold properties that were linked to traditional rental and more 6% who transferred properties that were placed in traditional rental to short-term rental.
“Half of the respondents think that real estate and leasing is a market with increasingly less attractive margins. A large proportion of owners (43%) consider real estate and leasing to be bureaucratic and difficult to understand. For 29%, it is an investment that requires excessive operating costs, but still, for almost a quarter of respondents (24%), it is a profitable and safe market to invest in”, can be read in the ALP statement. Only 2% of the landlords surveyed signed contracts under the affordable rental programs or the “Rent to Sublease” Program, created as part of the “More Housing” package.
And who is a landlord in Portugal? It is an aging ‘profession’, shows the barometer, which indicates that approximately half of the sample (48.2%) belongs to the elderly, over 65 years old, with 33.9% being between 65 and 75 years old. There are only 1% of young owners aged up to 34 years.
More than half of the respondents (51.4%) reveal that they own up to five properties and more than two thirds of the sample (76.4%) own up to ten. The majority (93%) have their properties placed on the traditional rental market, 11% say they have their homes on short-term rentals and 7.6% say their properties are rented to students. The ALP barometer also reveals that “more than half of landlords earn up to three gross national minimum wages (2460 euros) for the properties they have placed on the market”.
“This value has remained completely stable throughout the seven editions of the barometer. Landlords belong to the lower middle class. According to the criteria for the transition of rents prior to 1990 to the NRAU, they would have an economic need. Many of our members experience great financial difficulties as they face very low frozen incomes”, highlights Diana Ralha, director of ALP, to DN/Dinheiro Vivo (see interview below)
Of those questioned for the barometer, 56.4% revealed that they had rental contracts prior to 1990, that is, so-called frozen rents. And more than half of these receive between 50 and 100 euros in income.
