Portugal's Left Bloc wants to ban the sale of real estate to foreigners

Portugal's Left Bloc (Bloco de Esquerda, also known as BE) has presented a bill to prohibit the sale of property to citizens or companies with headquarters or permanent residence abroad, as a way to combat rising prices in the real estate market in Portugal. This is despite warnings from experts that this is not the way forward for Portugal. We have the details. 

Portugal's Left Bloc has announced the delivery of a bill in parliament to prohibit the "sale of property in national territory to individuals or companies, with their own and permanent residence or headquarters abroad". According to the party, this measure - which, in general terms, was recently adopted in Canada - aims to "combat rising housing prices".

In the text of this law, BE points out, however, that this ban would not apply to "Portuguese citizens with their own permanent residence outside Portugal", nor to asylum seekers or immigrants with permanent residence permits.

Also excluded would be "property transactions in low density territories", as well as "foreign citizens who acquire a property, in co-ownership, with their spouse or with a de facto unmarried person".

"The fundamental right to housing is yet to be fulfilled"

In the explanatory memorandum to the bill, the party led by Catarina Martins argues that, "in Portugal, the fundamental right to housing has yet to be fulfilled".

The Bloco de Esquerda advances statistics that between 2010 and 2022, housing prices "increased by 80% and rents rose by 28%", causing residents in Portugal to spend "a brutal percentage of their income on housing".

While acknowledging that the "housing crisis is not a Portuguese singularity", the BE nevertheless considers that "Portuguese governments have only aggravated this trend, with their policies of privilege and inequality".

According to the party, the "process of gentrification and financialisation of housing motivated the mobilisation of citizens and local authorities in several European cities", leading to legislative changes at international level.

Among the examples cited in this bill, the BE specifically mentions that, "in Canada, the Liberal Party government banned the sale of residential buildings to foreigners, a measure that had already been implemented in New Zealand and will recently also become a reality on the islands of Ibiza, Mallorca and Menorca".

"Proponents of these measures, whose implementation has been hampered by the power of real estate interests, invoke the same argument: competition from financial capital makes housing prices unaffordable for local citizens," the bill reads.

For BE, "if this is the reality in Canada, Holland, Germany or Catalonia, even more so in Portugal, where salaries do not compete, neither with the financial power of investment funds, nor with the personal income attracted by 'gold' visa regimes, tax benefits for non-habitual residents, or cryptocurrency speculators".

The party further adds that these international experiences show that "the process of real estate inflation requires exceptional measures, aimed at protecting the right to housing".

In this sense, "in addition to the repeal of measures to attract foreign capital in the Portuguese real estate sector, BE proposes the prohibition of the purchase of real estate for housing by non-residents, provided they are located in areas of urban pressure," the document refers.

BE argues that "this measure, recently adopted in different versions by the Dutch and Canadian governments, is justified by the recognition of the serious violation of the constitutional right to housing, in the name of economic interests".