New Opportunities for Portuguese Real Estate: New Legislation for Rural Lands

Portugal is home to a diverse range of land types, each serving distinct purposes. While some areas are designated as protected zones to preserve the natural environment, others are primarily used for agricultural and livestock activities. These areas are broadly classified as rural lands, where housing construction is not allowed.

However, an amendment to the Legal Framework for Territorial Management Instruments (RJIGT) was introduced through a decree-law approved on 28th November by the Portuguese government.

This new measure aims to address the housing crisis that Portugal has been facing in recent years by increasing the availability of land for residential construction.

It is important to note that this amendment is currently in the deliberation period. Hearings with the National Association of Portuguese Municipalities (ANMP) and other relevant entities are still underway, and the final version of the decree-law has yet to be finalised.

To effectively address the housing crisis and prevent real estate speculation, this new framework mandates that 70% of the construction on these lands will be designated for public or affordable housing, explicitly excluding the development of luxury properties in these areas.

The maximum price for these homes will be capped at either the national median house price or 125% of the median price in the respective municipality, whichever is higher.

In municipalities with higher housing costs, such as Lisbon and Cascais, the price limit is set at 225% of the national median. By providing these pricing thresholds, the government hopes to attract middle-class buyers while encouraging developers to invest in interior regions, where property prices are typically lower.

The remaining 30% of houses built on these rural lands will not be subject to price or rental restrictions, providing developers with greater flexibility to target other market segments.

To preserve the sustainability of Portugal’s lands, areas classified as National Ecological Reserve (REN), National Agricultural Reserve (RAN), those protected by the Natura 2000 network, and other sensitive zones will remain excluded from the scope of this amendment.

Portugal’s real estate and social policies are closely interconnected, aiming to create a balanced and fulfilling life in this beautiful country.

If you want to explore the Portuguese real estate market or need guidance, feel free to contact us. Our team is ready to provide tailored support and expert advice.