Miguel Marques dos Santos has written an article for Magazine Imobiliário entitled “Lease Reform: The Missing Piece”, in which he analyses Draft Law No. 103/XVII/1 and the main proposed amendments to the New Urban Lease Regime and related legislation.
Following the measures concerning tax incentives for housing and the reform of the licensing regime, Miguel Marques dos Santos considers this proposal to be “the missing piece” and possibly “one of the most important” steps towards promoting a more balanced rental market.
“This draft law is specifically intended to restore confidence,” the author states, highlighting four key pillars: strengthening private autonomy in determining the content of contracts; enhancing certainty in the enforcement of contracts; reforming procedural rules; and strengthening the State’s social responsibility for protecting vulnerable tenants.
The measures analysed include removing the cap on rent increases between leases, allowing up to three months’ rent to be paid in advance and removing the limits applicable to security deposits. According to Miguel Marques dos Santos, these changes “allow landlords to feel better protected when entering into a lease and may therefore be decisive in encouraging many property owners finally to place their properties on the market”.
The author also emphasises the importance of ensuring greater speed and predictability in lease termination proceedings, as well as promoting a balanced solution for transitioning leases entered into before 1990 to the current regime, while safeguarding vulnerable tenants.
Miguel Marques dos Santos concludes by arguing that this could be an opportunity to establish “a normal and balanced lease regime, as is the case in most Western countries”.
