Adopted at first reading on 30 September thanks to Chega’s abstention, the urban tenancy reform is hanging in the balance. André Ventura is threatening to vote against it if the government does not amend the bill, the PS is demanding its withdrawal, and the PSD refuses to back down. Advance rent, security deposits, unpaid rent: here is what the bill sets out, and what could still change for tenants and landlords.
Three months’ rent in advance instead of two, an unlimited security deposit, and eviction proceedings triggered after just two months of unpaid rent: the reform of urban tenancy law presented by Luís Montenegro’s government passed its first hurdle in Parliament on 30 September. Three weeks later, it is hanging by a thread. Chega, whose abstention allowed the bill to pass, is threatening to vote against it; the PS is demanding its withdrawal; the PSD refuses to back down.
A motion passed thanks to Chega’s abstention
On 30 September, the Assembly of the Republic approved the government’s bill at first reading (‘na generalidade’). The PSD, IL and CDS-PP voted in favour; Chega abstained; the PS, Livre, PCP, PAN, JPP and BE voted against, according to the Lusa news agency.
This abstention came at a price. Shortly before the vote, André Ventura, president of Chega, and Hugo Soares, leader of the PSD’s parliamentary group, signed an agreement under which the PSD ‘undertakes’ to introduce four amendments during the committee stage:
- to limit the advance payments and deposits that the landlord may require;
- to protect elderly tenants, particularly those on low incomes who hold tenancies dating from before 1990, through a compensation scheme for landlords;
- increase social assistance for tenants and the emergency housing fund;
- to distinguish between repeated cases of abuse and non-payment – which would justify swift eviction – and situations where there is a genuine inability to pay.
The bill is now before the committee (‘especialidade’), where it may still be amended before the final vote.
How the proposal would affect tenants and landlords
According to the analysis published on 1 October by the consumer organisation DECO PROteste, the text as adopted at first reading provides, in particular, for:
- Advance rent: the landlord could ask for three months’ rent in advance, instead of the current two. For a monthly rent of 2,300 euros, this amounts to 6,900 euros to be paid upon signing the tenancy agreement.
- Security deposit: this is currently capped at two months’ rent; it would be deregulated.
- Rent under a new tenancy agreement: the 2 per cent cap limiting rent increases under new tenancies has been abolished; the amount will now be set freely between the parties.
- Unpaid rent: the tenancy agreement could be terminated after two months’ arrears, rather than three, or after more than three instances of arrears lasting more than eight days within a twelve-month period, or more than four such instances within an eighteen-month period.
- Renewal: the landlord could object to the automatic renewal of the tenancy by simply giving notice, without having to wait three years as is currently the case.
- Right of pre-emption: in the event of a sale, the tenant would only be entitled to priority to purchase after having lived in the property for more than three years, rather than two.
For tenancies entered into before 1990, where rents are frozen, tenants aged over 65 whose annual income remains below 64,400 euros would retain their current rent; above that threshold, the rent could be increased to one-fifteenth of the property’s taxable value, according to DECO PROteste. The possible duration of tenancies, ranging from one to thirty years, remains unchanged.
Chega issues a threat; the PS demands its withdrawal
On 18 October, André Ventura warned that “a vote against is always on the table”. The following day, he elaborated on his criticism: “So far, we have had no indication that the Government wishes to rectify this. ” The agreement, he added, “is not a blank cheque”. As the PS is voting against it, a ‘no’ vote from Chega would bring down the bill, notes the newspaper ECO.
The PS, for its part, does not wish to negotiate. “The only solution is for the Government to withdraw its draft bill,” said its parliamentary group leader, Eurico Brilhante Dias, on 21 October. The party’s general secretary, José Luís Carneiro, describes the bill as a “social powder keg” and proposes instead a state-backed rent guarantee, which would protect both landlords and tenants. The debate has also spilled out onto the streets: camps set up to demand the right to housing have been cleared by the police at Rossio in Lisbon and at Praça D. João I in Porto, reports the *Diário de Notícias*.
The government is standing firm, but is leaving the door open
The PSD is not backing down. “Do you really think that’s possible? We’re not being led by the nose by the protests,” replied Hugo Soares, before adding: “For the time being, our agreement with Chega remains in place.” ” The Minister for Housing, Miguel Pinto Luz, says he is open to revising the bill in Parliament, whilst rejecting the idea of an “inhumane” law.
A compromise could be reached on the issue of the security deposit. MP Gonçalo Lage, the PSD’s coordinator on the Housing Committee, considers it ‘reasonable’ to cap it at three months’ rent, whilst pointing out that this is still merely ‘a basis for negotiation’. He also acknowledges the fragility of the agreement: on labour reform, Chega ultimately voted against the bill.
So nothing is a foregone conclusion, one way or the other: for tenants and landlords alike, the lease of the future is still being negotiated, this time between two parties who do not trust one another.
Practical information
What is the current status of the bill? Adopted at first reading on 30 September 2026, it is currently being examined in committee, where the parties may table amendments before the final vote.
What remains unchanged for the time being: until the law has been definitively passed and published in the Diário da República, the current rules apply, including to tenancy agreements signed today: a maximum of two months’ rent paid in advance, a security deposit limited to two months’ rent, and termination for non-payment after three months.
Key points to note: the cap on security deposits and advance rent, protection for older tenants, and the two-month deadline for unpaid rent.
Last updated: 22/10/2026
Article written with the help of artificial intelligence, proofread, edited and approved by François Wilman.
This article has been written with the utmost care, but may contain errors or out-of-date information. Always check important information against official sources before using it.
This article has been automatically translated from French for your reading convenience. Only the French version is legally binding.