The European Commissioner for Financial Services, Financial Stability and Capital Markets Union, Mairead McGuinness, reported on this in response to a parliamentary question from Spanish MEP from the Balearic Islands Rosa Estaràs, from the Popular Party (PP).
According to a report by idealista/news, the question posed by the MEP was whether it would be possible for Member States to limit the purchase of homes to non-residents, taking into account restrictions on the movement of capital between EU countries.
In the official response, Brussels recalls that Article 63 of the Treaty on the Functioning of the EU prohibits restrictions on the movement of capital related to the acquisition of real estate, “including housing”, by non-resident citizens.
It stresses, however, that "such restrictions may be justified" for "reasons of public order or public security, or for overriding reasons of general interest recognized in the case law of the CJEU, provided that they are non-discriminatory and are proportionate to the intended objective" .
This means that the measures must be “adequate to guarantee, in a coherent and systematic way, the achievement of the intended objective” and not go “beyond what is necessary to achieve it”, she adds.
Balearic Islands wants to ban home foreign buyers
The Majorcan MEP's question made no mention of this possibility, which has been debated for some months in the Balearic Islands. Recently, the general secretary of the Podemos party and current Minister of Social Rights and Agenda 2030, Ione Belarra, promised to “put pressure” on the socialist part of the Spanish government so that “the islands can legislate the restriction on the purchase of homes from non-residents” .
The vice-president of the Government of the Balearic Islands, Juan Pedro Yllanes, has said on several occasions that the CJEU could accept a “Balearic exception” to allow this measure, taking into account the “special circumstances” existing in the Islands. Yllanes guarantees that the TJUE “does not completely rule out” this type of regulation and that the Balearic Islands “meet the requirements” for this restriction to be allowed.
Is Portugal also considering prohibiting sales to foreigners?
In Portugal the Bloco de Esquerda (BE) presented, at the beginning of the year, a bill to prohibit the sale of real estate to citizens or companies with headquarters or permanent residence abroad, as a way to combat the increase in prices in the real estate market . A measure that does not enter, for now, into the plans of the Government.
The real estate sector also does not welcome such a measure. Rafael Ascenso, CEO of Porta da Frente, said that such a measure “could implode the market”.
“Throughout these 27 years that we have been in the market, we have never seen a populist measure that worked. Our reality is not the same as in Canada, on the contrary, we have lived these last years on much of the income we had through foreign real estate", said the official.
An interesting article, and an interesting question.
I think part of the discussion is not just on foreign ownership of houses, but for people, is it a fundamental human right to have a home? The next question would be,
should that be in the form of rented or owned, each have a cost?
I have to say at this point I am not Portuguese, but I have lived in Portugal, and I choose this place as my home, for what I believe to be the right reasons.
I consider myself a guest in this country, but I do need some security for my stay here (I do not wish to leave now or in the future) to make that stay viable.
The biggest problem with the house market is, it is a market place, where the king is money the more you have, the more you get.
To change the housing market would need to recognize its function is not just a market, but to have a home is a human right.
The housing market will always oppose this, as the people in it draw their living from it, and want minimum interference with that market.
I think no foreign buyer should be able to buy and own a house unless they are a permanent resident in Portugal, and spend the vast majority of their time living here, contributing to the national and local economy.
I think that would reduce real estate speculation, and would ease the pressure on the housing market, and perhaps should be considered the first logical step.
Any policy would need to assessed once in practice, and validated.
Further moves to change the house policy in Portugal would call into question the whole "freedom of movement principle", and may not even be needed.
Having a house is a problem in Portugal, as it is in many other countries. Dealing with that issue will be a problem that will need to be resolved.
By Ian Dowdle from Alentejo on 02 Apr 2023, 11:39
There is 'overriding reasons of general interest' when minimum salaries are lower than rents or even when people with 'good' wages for Portuguese standards can't afford to have a place to live. The situation in Portugal is absurd.
By Diogo F. from Lisbon on 02 Apr 2023, 17:27
Portuguese governments should have acted faster to prevent this situation of a lack of affordable housing. They have been reactive instead of being proactive as signs were there for years that Portugal was a hotbed of interest with foreigners for many reasons. Did any of those idiots in charge really think the historical low wages in Portugal, even for educated professionals, would keep up with the housing market fuelled by investment schemes for the past 10 years? It's corruption. Simple as that. Someone won here and it's not your average Portuguese resident. What a shame! Good luck fixing this now.
By Manuel from Other on 03 Apr 2023, 01:18
Diogo F. You are of extremely, extremely, extremely low intelligence.
By Jeff BB from Beiras on 03 Apr 2023, 23:24
Just look at the number of holiday homes, and you will see the problem. Where I live, many homes sit empty for 48 weeks of the year as the Portuguese and foreigners owning them only venture out of Lisbon or from the home countries for holidays. Coercive leasing seems like a great idea to me. If you don’t live in the house, someone else could!
By Ian from Beiras on 04 Apr 2023, 07:06
You need just to build more. So simple.
Restricting demand will lead to even greater shortages - we went through this in the Soviet Union.
Less demand - less profit - less investment in the industry - reduced construction - more deficit.
Instead, it is necessary to liberalize the industry, reduce bureaucracy, and speed up construction.
You have a demand - use it to earn and increase GDP.
By Dmitry from Algarve on 04 Apr 2023, 08:56
Greetings from Bilbao today...Been an legal resident of Portugal since 2016...Orginally from the U.S. The current state of Affairs is happening everywhere...Spain has seen it's share of problems...If you look back at history there have always been poor and rich...The middle class has been eliminated in the United States...The government does not work for it's citizens but Central Banking Cartels...and until the people of the world shut them down...Then only will you have a chance of starting with a clean slate...
By Sakamoto Saurez from Lisbon on 04 Apr 2023, 09:00
In South East Asian countries only people born in those countries with ID cards can own properties, foreigners cannot own properties or land, this keeps the prices at an affordable rate for their citizens, try buying a property in any other country, prices are rocketing out of control, just to clear things up, yes in Asian countries you can buy anything you like but you cannot own it or have title to it, it must be put in the name of a local person, it all makes sense, in Portugal a man's haircut is over €15, in Laos it's 18 cents, ask yourself why ?
By Mr John from Algarve on 04 Apr 2023, 13:01
Jeff BB I am sorry reality is so shocking to your highly intelligent patriotic mind. Get over it.
By Diogo F. from Lisbon on 04 Apr 2023, 23:20