1. Iberian Rental Housing Systems – Legal changes in Portugal and Spain after the crisis Maria-Olinda Garcia Faculty of Law – Coimbra University, Portugal ogarcia@fd.uc.pt 1

2. TENLAW: Tenancy Law and Housing Policy in Multi-level Europe 2012-2015 This project has received funding from the European Union's Seventh Framework Programme for research, technological development and demonstration under grant agreement no 290694 http://www.tenlaw.uni-bremen.de/ http://www.tenlaw.uni-bremen.de/ 2

3. Portuguese and Spanish private rental housing Laws Housing is not under the EU Treaty Importance of national laws: – For foreign investors – For foreign workers 3

4. Portugal and Spain housing characteristics in common: ( Censos 2011) 4 PortugalSpain Owner-occupied dwellings 78%80% Rented17%15% Vacant 12%13%

5. Brief Historical Background 5 PortugalSpain Tenants very protected: - Rents frozen - Landlords did not have the right to terminate the contracts Until 1990Until 1985 Short-term rental agreements allowed After 1990, minimal duration 5 years - Between 1985 and 1994, minimal duration: 3 years - After 1994, minimal duration: 5 years Old and new legal frameworks co-exist yes

6. Urban Lease Acts after the crisis Portugal Act n.31/2012 Spain Act n.4/2013 Duration of the contractThere is no minimal duration Minimal duration : 3 years Landlord’s rights to terminate the contract If the tenant does not pay the rent for 2 months; - No need to go to court to terminate the contract After 1 month delay: - Court order (but not a judicial decision) Eviction process fasterExtra judicial processFaster judicial decision Registration of the contract----------------If the contract is not registered, when the dwelling is sold the rental agreement ends. Tenant pays a penalty to terminate the contract before the agreed time T. cannot terminate the contract before 1/3 of the agreed time has elapsed T. cannot terminate the contract before 6 months have elapsed 6

7. Consequences of the new legislation - Rising supply of dwellings for rent - Uncertainty about current and future effects of the new rules : - lack of official data - inconsistent information: - increasing number of people interested in buying a dwelling - value of rents not going down 7

8. (Eurostat 2013) 8

9. Will the new legislations be decisive in increasing the percentage of rented dwellings? - From a tenant’s perspective: - both systems do not combine correctly stability and flexibility 9