Parliament moves to unlock inherited homes with forced-sale law

Parliament has approved legislation aimed at unlocking thousands of inherited properties that have remained tied up in family disputes, clearing the way for a single heir to force the sale of jointly-owned real estate in an effort to ease Portugal’s housing shortage.

The government bill passed today with the support of the governing PSD and CDS-PP, alongside the PS, Iniciativa Liberal (IL) and JPP. Chega and PAN abstained, while the PCP, Left Bloc (BE) and Livre voted against.

The reform forms part of the government’s wider housing package, designed to increase the supply of homes available for sale and rent by tackling long-running inheritance disputes that often leave properties vacant for years, if not decades.

During parliamentary debate, PSD lawmaker Paulo Marcelo said Portugal has around 485,000 vacant family homes, while an estimated 3.4 million rural properties have no clearly defined owner – leaving many abandoned and vulnerable to wildfires.

The legislation authorises the government to create a fast-track procedure allowing the sale of jointly inherited properties when heirs cannot agree, with ministers given 180 days to implement the new rules by amending the Civil Code and the Code of Civil Procedure.

The new regime will apply to all undivided estates that exist when the law comes into force.

Following amendments introduced by the PSD during committee scrutiny, family homes occupied by a surviving spouse or civil partner will be excluded from the forced-sale procedure unless that person gives explicit consent. Insolvent estates are also excluded.

Another significant change is the creation of an independent executor with powers to administer, liquidate and divide an estate, removing much of the burden from heirs and allowing succession procedures to be handled by a neutral third party in an effort to speed up settlements.

The legislation also allows heirs, by simple majority, to appoint a different person to administer an estate, replacing the traditional “head of the household”, except where the surviving spouse holds that role or where an executor has already been appointed. The measure incorporates a proposal originally put forward by IL and accepted by the PSD during committee discussions.

The government will also establish the eligibility criteria and responsibilities for the new executor role.

The law contains a further safeguard preventing the division of an estate for up to three years where the deceased had consented to posthumous insemination, or until the birth of a child conceived under the legally permitted procedure.

The measures were first approved at committee level in June and are among a series of reforms the government says are intended to help address Portugal’s housing crisis by bringing more properties back into productive use.

Source material: LUSA

Natasha Donn

Journalist for the Portugal Resident.