2023-10-06 13:15:16
After just over seven months since the launch of the Mais Habitação program, the PS alone approved in Parliament a program that essentially serves to guarantee the profits of banks and speculators, the biggest beneficiaries of the current housing crisis. in Portugal.
By: Joana Salay
The first half of 2023 ended with the announcement that banks in Portugal made record profits. This was to be expected, given that, for ten consecutive times, the European Central Bank has increased interest rates, with the aim of ensuring that banks can rebuild their profits at the expense of increasing loan payments.
In Portugal, the five main banks (CGD, BCP, Santander, BPI and Novo Banco) increased their profits by 58% in the first six months of this year. This increase is sustained by the increase in housing loans which, since interest rates began to rise, have already increased 80%.
An increasingly unsustainable situation
The housing crisis [vivienda] It is not only about the increase in credit, which affects around 27% of families in Portugal, but also about access to housing, which affects another 30% of families who do not have their own home. In Lisbon, rents rose 13.9% in the first half of this year and 32.7% in June compared to the same month in 2022. This increase is also due to the disastrous policy of the government, which announced a possible control of the increase of rents, but did not apply it, which caused an early increase by the owners.
However, the evolution of rent increases has been almost constant since 2016, at a very pronounced rate and completely different from the increase in family income. The causes of the increases are already known: the liberalization of the rental market, the seengold, the non-habitual residence regime, incentives for digital nomads and local accommodation. It’s a clear reversal of what the social role of houses should really be.
Speculation and housing
Data from the Bank of Portugal itself show that 93.9% of foreign direct investment corresponds to real estate investments made by non-residents in Portugal, and that the weight of this type of investment has almost doubled in 15 years. It is a speculator’s paradise.
This figure is a symptom of the search for potentially high investment returns in homes in Portugal, especially those subject to reclassification. Big-time investors buy houses, often leaving them empty for years, and then sell or renovate them, making millions in profits. The governments’ policy of attracting foreign money is like fire in a haystack to drive up housing and rental prices.
A crisis with history
The current housing crisis is a consequence of the political options that have been taken since April 25 [1974]. At that time, the possibility was raised that the working class and the poor, organized through residents’ associations, would build collective solutions to the then housing crisis generated by the policies of the Estado Novo. However, the consolidation of bourgeois democracy, carried out by the PS with the complicity of the PCP in the mass movement, caused the deviation of this process towards the implementation of bourgeois logic, where private property and profit prevail. Thus, the policy was to prioritize the facilitation of housing loans to the detriment of the construction of a public housing stock, which resulted in a progressive indebtedness of families and the strengthening of large banks and real estate funds.
Costa’s measures serve banks’ profits
El paquete More Housing [Más Vivienda]so discussed in recent months, preserves all the conditions that favor and stimulate private initiative, valuing the functioning of the real estate market as a solution to the housing problem.
In relation to the rental market, Mais Habitação provides for the creation of tax incentives for owners to bring homes to the rental market and maintains tax benefits for non-habitual residents. Worse still, the proposal did not have the courage to interfere with the famous Cristas Law, which accelerated evictions, freed the market, and encouraged real estate speculation.
Regarding housing credit, one of the most talked about measures at the moment, the 30% “discount” on interest on housing loans, is a big push in the belly. What Costa calls a discount is a deferral of the payment of this amount for four years, diluted in the total loan. The other measure, which is the interest subsidy, is support that can reach up to 800 euros per year for families that meet the defined criteria. This is yet another measure to divert public funds to ensure that families continue to pay the banks’ profits.
The solution is to return housing to its social function of dwelling, not profit!
The solution to the housing crisis in Portugal is to attack the problem at its roots. It is necessary to apply measures that confront the interests of banks and speculators and reestablish the true social function of the house, where houses are used for living and not for speculation, and every person who lives and works in Portugal can have a decent home. and appropriate to your needs.
Public control of housing prices is needed! Prices linked to the national minimum wage!
The most immediate measure to contain the housing crisis is to reduce rents and housing prices, through public control. The logic of market self-regulation is what brought us here. Action is needed to ensure that house prices are linked to the national minimum wage and are compatible with the incomes of the working class and immigrants, those most affected by the housing crisis.
Regulate the rental market! Ban evictions!
The liberalization of the rental market, carried out by the Cristas law, triggered a sharp increase in rents, since the logic of the owners is to obtain the greatest possible profit and, therefore, they prioritize renting to the elderly sectors. income: foreigners, tourists, visas gold, etc. Those who live and work in the city were excluded from their right to housing. There is a need to regulate the rental market and prohibit repeated evictions as a way to further increase rents.
Ban the sale of houses to non-residents! Regulate local accommodation!
The search for foreign investment in the real estate market by the PS and PSD governments led to the rampant nonsense we have today, where houses in Lisbon are for people who do not live here. We have neighborhoods, like Mouraria, where the majority of homes are local accommodation. To reverse this situation, it is necessary to prohibit the sale of houses to non-residents and regulate local accommodation.
Expropriate empty houses and investment funds for a public housing plan!
There are several empty houses that are bought for speculation, waiting for the property to increase in value and the investment to be recovered. If there are homeless people, there cannot be empty houses. It is necessary to expropriate the empty houses that are owned by investment funds to create a true public housing stock at the service of the lower-income population.
End real estate investment funds! Nationalize banking!
To guarantee all these proposals it is necessary to put an end to real estate investment funds and nationalize the banks. It is not enough to say that the increase in interest must come from banking profits, as the BE and the PCP say. It is necessary to nationalize the banks under public control and thus, through a workers’ government, put them at the service of the interests of the working class and the poor people.
Article published in In FightPortugal, 28/9/2023.-
Translation: Natalia Estrada.
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