New Measures for Short-Term Rentals Announced by the Portuguese Government

Overview of Changes to Alojamento Local (AL) Regulations

Short-term rentals, known as Alojamento Local (AL) in Portuguese, have recently undergone significant regulatory changes. The new government has revoked several measures introduced by the previous administration, particularly those affecting contributions from owners of short-term rental properties and the validity of local accommodation licences.

Prior to the general elections in March 2024, the previous government introduced a policy package called “Mais Habitação.” This initiative aimed to tackle the country's housing crisis by increasing the availability of houses. The complete plan addressed various aspects, including local lodging regulations, residential leasing policies, tax implications, and the management of vacant properties.

One of the key components of this package was the special contribution to local accommodation (CEAL), set at 15%. This contribution was calculated based on factors such as the economic coefficient of local accommodation and urban pressure coefficients. It was intended to regulate the short-term rental market and ensure contributions from property owners.

On the 27th of May, 2024, the new government revoked several of these changes. The most significant reversal was the abolition of the CEAL, meaning that owners of short-term rental properties are no longer required to pay this special contribution. The payment deadline would have been on the 25th of June, 2024.

Another important change is related to the "coeficiente de vetustez" (coefficient of agedness), which assesses properties based on the year since their construction or last major renovation. This coefficient has, also, been revoked and will not be used for the purpose of IMI assessment.

In addition to these changes, the new government has shifted the regulatory focus to decentralisation. Local authorities are now empowered to regulate local lodging activities and handle conflicts in buildings with horizontal property divisions. Local authorities will also manage the validity of local accommodation licences.

The Portuguese government is dedicated to fostering an environment that encourages real estate investment, particularly in the tourism sector. At the same time, it seeks to balance this with local regulations designed to prevent and mitigate the ongoing housing crisis affecting Portugal and other European countries. Given the varying demands for housing across different cities and regions in Portugal, these measures aim to effectively provide tailored solutions that address local needs.

If you need assistance with your real estate investments in Portugal or navigating the specific requirements for tourism-related licences, we are here to help. Contact us for expert guidance and support in making the most of your investment opportunities in Portugal.