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€100 million sat in a drawer while Lisbon’s frozen rents thawed

€100 million sat in a drawer while Lisbon’s frozen rents thawed

The rent notice arrives on thin paper, but the numbers hit hard. Across Lisbon’s oldest parishes, tens of thousands of tenants still pay pre-1990 rates, an average of €164 a month in the metropolitan area, many well under €100. The phased end of Portugal’s decades-old rent freeze has turned that gap into something closer to an eviction calendar.

The state has now put a price on the damage. On 9 July, the Council of Ministers regulated the Fundo de Emergência Habitacional (Housing Emergency Fund), created by Parliament in November 2023 at the initiative of the Livre party. Funded by 25% of stamp duty on property transactions, it accumulated roughly €100 million—money that sat in a drawer for more than a year because no government wrote the rules to release it.

Under the regulation presented by housing minister Miguel Pinto Luz within the “Construir Portugal” (“Build Portugal”) reform, families facing eviction through judicial or special procedures will receive €537.13 per month for six months, with housing costs capped at €2,300. The fund takes effect on 1 January 2027, budgeted through next year’s state accounts.

The weight falls unevenly. The government estimates 30,000 to 50,000 old-regime contracts survive nationally; Greater Lisbon alone holds 46% (some 69,800 contracts). Seventy-nine per cent of these households pay under €200. Tenants over 65 or with a disability rating above 60% remain under the previous regime entirely; those who do transition receive five years of rent stability, and extraordinary increases apply only to incomes above €64,400 a year.

“The weaker party gets even weaker.”

António Machado, Associação dos Inquilinos Lisbonenses

Yet €537 a month for half a year, against Lisbon market rents now well above €1,200, leaves a shortfall no six-month subsidy will close. The Lisbon Tenants’ Association has rejected the reform’s acceleration of evictions: the arrears threshold drops from three months to two. “The weaker party gets even weaker,” warns its leader António Machado. On the landlord side, Luís Menezes Leitão, president of the Lisbon Property Owners’ Association, dismisses the unfreezing as “tiny,” noting frozen rents still represent 16% of the housing market.

The fund’s €100 million waited while the notices kept arriving. It now has rules, a date, and a monthly figure. Whether €537 is a bridge to a new home or a slower goodbye depends on which side of the letter box you stand.