In 2023, the cost of rents for residential and commercial properties in Portugal can be increased by the landlord by a maximum of 2% instead of the previously accepted 5.43%. The decision is part of a program to combat inflation and respond to rising prices.

To compensate landlords for this limitation of rent increases for residential and commercial real estate in the coming year, the Council of Ministers has decided to provide tax incentives that will be applied automatically to the annual tax return.

“This is the balance we were aiming for; we set a growth that has criteria, a long-term goal,” said the Socialist leader, Pedro Nuno Santos, at a press conference held on Tuesday, September 6.

Thanks to the government’s intervention in the real estate rental market, the annual appreciation rate was only 2% instead of the projected 5.43% inflation rate recorded in August 2022.

According to Idealista/News, the Spanish and French governments also took the same decision to limit the increase in the rent coefficient.

“This measure will offset reductions in the IRS and IRC of landlords. Tenants will save the difference that landlords will compensate,” said Portuguese Prime Minister António Costa.

It should be noted that landlords have reacted very negatively to this ruling.

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