Councils Late on Social Housing Can Claim 10 More Points of State Funding if Portugal 2030 Also Backs the Homes

Councils racing to finish social housing under the 1.º Direito programme (the government's main programme for housing families who cannot find a decent home on their own) can now get 10 percentage points more public money for each home, if they also win European cohesion funding for it. The change is in Resolução do Conselho de Ministros n.º 185/2026 (Council of Ministers Resolution 185/2026), published in the Diário da República (the official gazette) on 25 September. It was approved on 4 September and applies from that date.

What councils were getting

The resolution amends a 2024 resolution, rewritten in March 2025, that set up a special State Budget scheme for 1.º Direito homes that had slipped behind the deadlines of the Plano de Recuperação e Resiliência (Recovery and Resilience Plan, PRR). It covers housing promoted by councils and the other public and non-profit bodies the programme allows, finished by 31 December 2030. The share of eligible costs the state pays falls the later a home is finished:

• 100 percent if completed, including the tenancy contract where there is one, by 30 June 2026;
• 85 percent by 31 December 2026;
• 75 percent by 30 June 2027;
• 65 percent by 31 December 2027;
• 60 percent by 31 December 2030.

The first four bands apply to projects approved or accepted under the first PRR call for 1.º Direito, and they must meet the PRR's technical requirements.

What changes

Homes in the three middle bands (end of 2026, mid-2027 and end of 2027) can now have their percentage raised by 10 points, to 95, 85 and 75 percent, up to the money available. Two conditions apply: the same homes must also be the subject of an application to the Portugal 2030 funds for social housing, and that application must be approved on or after 1 July 2026.

The European money comes first. The State Budget pays only the difference between the raised percentage and what Portugal 2030 has granted. The state's own share is capped at 65 percent, and total public funding at 95 percent of eligible costs. It is up to the councils and other beneficiaries to apply to Portugal 2030 under its calls, and their projects must already be far enough along, financially, to meet the completion deadline of their band.

The government says it is acting because recent reprogramming of Portugal 2030 increased the money for social housing, and because the European structural funds can now support 1.º Direito homes that are part of a council's local housing strategy. The aim, the preamble says, is to use every available source of funding in full and give "all possible support" to building new homes.

The money, and the homes

The spending authorised for the Institute for Housing and Urban Rehabilitation (IHRU) is unchanged: up to 2,011 million euros plus VAT from 2025 to 2029, including 845 million to fund up to 100 percent of 10,000 homes moved out of the PRR and into 1.º Direito. The combined plan still totals 58,993 homes and 4,185 million euros.

The split has moved, though. The new annex attributes 20,000 homes to the PRR and 39,993 to the 1.º Direito lines, against 26,000 and 32,993 in the version it replaces. The two State Budget lines that backed PRR homes can now also be met from European structural funds "where applicable".

What this means for residents

• If you are waiting for a council home, this does not change who qualifies or how homes are allocated. It changes how a council pays for building them, which can decide whether a delayed project is finished.
• Delays cost councils money. Every missed half-year deadline cuts the state's share by 10 percentage points. The top-up softens that for councils that also win Portugal 2030 funding.
• Ask your council. Whether a project near you benefits depends on its own Portugal 2030 application; the resolution names no councils or projects.

Completion is not the same as a family moving in: in May, only 12 percent of homes counted as finished had been handed over, and in August the government counted 28,000 homes toward its Recovery Plan deadline, most of them not yet occupied. Separately, the European Investment Bank is lending 1.5 billion euros for social housing.

Sources: Resolução do Conselho de Ministros n.º 185/2026, Diário da República, 1.ª série, n.º 187 of 25 September 2026; Resolução do Conselho de Ministros n.º 129/2024, consolidated text as amended by Resolução do Conselho de Ministros n.º 42/2025, on diariodarepublica.pt.