Starting November 1, 2024, the Portuguese government has significantly changed how it regulates licenses for Alojamento Local, the permits required to operate short-term rentals, and it is Great news for investors.
Key Changes to AL License Regulations:
AL License Transferability:
It is important to note that previously, AL licenses could not be transferred when there was a sale of property to new owners.
This limitation was removed from the new regulations; thus, when the property is sold, AL licenses can now be transferred to the new owners.
In this regard, the revised law affects individual property owners and companies with registered ALs.
Duration of AL Licenses:
AL licenses are now permanent and no longer expire after five years.
This move gives property owners who operate short-term rentals more stability and makes the investment far more valuable.
Of course, though the restrictions were removed at the national level, the municipalities may always introduce some regulations to impose some restrictions again, for example, expiration of a license or limits on its transfer, etc.
Condominium Approval:
The requirement of unanimous condominium approval to open an AL in a residential building has been eliminated.
It is now permissible for the property owners to issue an AL without all the resident’s approval.
Hostels are still subject to condominium approval if opened in a building with horizontal ownership.
Condominiums can still oppose AL operations in their buildings, but now they must provide stronger reasons.
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To rent out your property, you will first need to register it as a short-term tourist rental. Registration is done by the local town hall (Câmara Municipal), which will issue a license known as an Alojamento Local (AL), which means local lodging.
In essence, the Alojamento Local touristic license will allow establishments that seek to offer temporary accommodation services to tourists for payment to do so.
An Alojamento Local establishment may be in any of the following forms:
It is important to include the registration number and Alojamento Local on all advertisements – this goes for listing platforms online too. It is also a good idea to also mention the details in the written description of the property.
There has been increased vigilance in several countries over short-term rentals in recent times. They make rounds and checks frequently to ensure that properties are fully regulated. Of course, such properties are subject to the appropriate taxes, which is an added reason for their increased vigilance.
Many times, local authorities and inspectors have been known to pose as clients. They often search websites and ads searching for unregistered properties rented to holidaymakers.
Many foreigners own Portugal properties that serve as their holiday homes. They may choose to let out those properties for commercial purposes. Such owners are advised to comply with the local laws. It is important to note that these laws apply to both local and foreign property owners. Property owners may comply by registering at the appropriate local town hall (Câmara Municipal).
Normally, applications are regulated by the president of the respective local council. Each Applicant should provide the supporting documents:
The use of the local lodging establishment may begin as soon as the application has been accepted.
However, the local council is still bound to make rounds from time to time, inspecting the vicinity. If at any point the council is dissatisfied with the condition of the property or its adherence to the stipulated regulations, the application can and will be canceled.
In cases where property owners have failed to comply with the provided regulations, a fine may be charged. Fines may range from 3,500 – 25,000 Euros.
The registration process may seem daunting, especially if you aren’t a native of Portugal. This is where seeking legal help may be a useful decision. A legal organization will take care of the complicated and tedious paperwork and make your work a lot easier. When they are needed, they should be able to advise. Once the procedure is complete, the legal firm will inform the property owner when the license is approved.
An added advantage of going through a legal organization is that the process may be undertaken even if the property owner is outside of Portugal. However, it is essential to choose a trustworthy firm with a good reputation and track record.
As mentioned before, it is far easier to buy from one of our developments that have already been through the legal process and are safe to buy and receive rental income from.
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Yes, you will need to get the relevant license in order to rent out you Portugal Property. You will also need to consult your tax advisor to make sure you are structured in the best way to pay non resident income tax on your property. If you are buying for Golden Visa in Portugal then our company provides peace of mind as the whole building we are renovating and selling will come the correct licenses in place, and your rental income will be guaranteed. Trying to take on a single property for renting our and getting a golden visa is very risky now rental laws have changed and short term licenses are restricted, So simply don’t take any risks and invest with us.
Any property rented our for the purpose of short term rental tenants requires the correct license. Indeed any property rented our long term also needs to follow locals laws, but short term AIRBNB style renting has been restricted and you will need to check area by area. If investing in Lisbon the capital city then buying through a company such as our will give a selection of properties and developments that already have suitable licenses in place in order for you to receive your rental income. Mixed buildings of locals, young people, foreign people, some paying rent, some owners can be impossible for short term rent now, as the condominium of owners (freeholders) all need to agree on almost everything that goes on in that block, and this is rarely easy. If your focus is rental income then buying in a purpose built block is best.
The use of the local lodging establishment may begin as soon as the application has been accepted.
This would depend on the property and location but under 1000 euro.
You are notified and documents sent to your lawyer
Your property can then only be lived in by your/family/friends.
No, they simply book it like a hotel via AIRBNB etc
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