Portugal's 2027 Budget Plans 63.5 Percent Less Housing Investment as Recovery Plan Money Runs Out, With Council Rehousing Taking the Biggest Hit

The government plans to spend 63.5 percent less on its flagship housing investments next year. The 2027 State Budget proposal puts structural investment under Construir Portugal (Build Portugal), the strategy it presents as its answer to the housing crisis, at 1,061 million euros in 2027, down from 2,905 million euros estimated for 2026. That is 1,844 million euros less. The drop was first calculated by Jornal de Notícias and reported on Monday by Notícias ao Minuto; we checked the figures against the budget report.

Where the money falls

The numbers are in Table 4.20 of the budget report that the government sent to parliament with Proposta de Lei n.º 110/XVII (the 2027 budget bill). The table lists the central government's "structuring investments" for 2025 to 2027, and most housing lines in it are marked as including money from the Plano de Recuperação e Resiliência (Recovery and Resilience Plan, or PRR), whose deadline for investments passed on 31 August.

• Programa de Apoio ao Acesso à Habitação (the programme better known as 1.º Direito, which pays councils to rehouse families in poor conditions): 2,216 million euros in 2026, 424 million euros in 2027.
• Affordable-cost public housing, run by the Instituto da Habitação e da Reabilitação Urbana (Institute for Housing and Urban Rehabilitation, IHRU): up from 463 million to 612 million euros.
• Rehabilitation of the housing stock (IHRU): 22 million to 10 million euros.
• Mobilising state property for housing: 65 million to 15 million euros.

The fall is not unique to housing. Across the whole table, structuring investment drops from 9,540 million euros in 2026 to 3,301 million euros in 2027. Parliament's budget office, the Unidade Técnica de Apoio Orçamental (UTAO), wrote in its 19 October assessment that the projected 32.5 percent fall in public investment next year reflects the end of the PRR. It also noted that Brussels let housing, health and school projects that could not be finished by 31 August be scaled down, with the rest paid from national money or other EU funds.

What the government says it will do instead

The budget report says more than 30,000 homes have been completed, about 1,000 of them for affordable rent. For 2027, it names two housing priorities: bringing in private investment through public-private partnerships on state-owned property, and carrying out a financing programme for 45,000 homes that were left out of the PRR.

Rent support is budgeted separately. The Habitação (Housing) programme of the Ministry of Infrastructure and Housing has 2,003 million euros for 2027, of which 917 million euros go to access and rent support, including Porta 65 Jovem and Porta 65+. The report says Porta 65 will be strengthened, and that young buyers keep the public mortgage guarantee and the IMT and stamp duty exemptions on a first home.

What it means for you

If you are waiting for council or public housing, the line to watch is 1.º Direito, which falls by about four fifths. As we reported on Saturday, only about 12,000 of the 31,792 homes finished under the PRR were new builds, and many families named in councils' housing strategies still have no rehousing date. Ask your câmara municipal (town hall) whether your project was completed, moved to the extension the government allowed for unfinished PRR works, or still awaits funding.

If you rent, Porta 65 Jovem and Porta 65+ sit in a separate budget line and are due to be strengthened. The budget is still a proposal: parliament can amend it before the final vote.