Your Comprehensive 2025 Guide to the Alojamento Local (AL) in Portugal

The Portuguese real estate market has long presented an alluring opportunity for investors, with the possibility to secure a strong return on investment in many key areas across the country.

If you are considering jumping on the property ladder in Portugal and renting out your Portuguese property in the short term, you will need to obtain an Alojamento Local (AL) license.

Alojamento Local licenses are issued by the Câmara Municipal (local council town hall) and are required if you are going to rent your property out in the short term, for example, as guest houses on Airbnb or on booking.com.

In this comprehensive guide, we present a rundown of what an AL License is and how to obtain one, the latest changes to securing an AL license that came into focus on 1 November 2024, and essential practical information for prospective investors to be aware of.

What is Alojamento Local?

Alojamento Local, or Alojamentos Locais in Portuguese, refers to self-catering, temporary vacation rental properties listed on platforms like Airbnb and Booking.com. These properties are a popular option for tourists and travelers searching for short-term stays and are a significant part of the tourism industry in Portugal.

The AL License is a license that investors are required to have in order to rent out their property in the short term. AL establishments are those that provide lodging services, with the requirements being that:

• The establishment is furnished and rented out to tourists
• They are temporary accommodation, with a maximum of 30 days permitted
• They should not meet the requirements of tourist enterprises
  • Hotel establishments
  • Tourist apartments
  • Tourist villages
  • Tourism developments for housing or rural tourism

Types of Alojamento Local in Portugal

AL accommodations can be the following types:

• Apartment (Apartamento)
• Villa (Moradia)
• Lodging Establishment/Hostel (Estabelecimento de Hospedagem/Hostel)
• Rooms (Quartos)

No matter the property type, it must include a kitchen for guests to prepare their own meals, a bathroom (even if it is a shared bathroom), and at least one bed.

Background of the AL License Portugal

Local accommodation regulated by law in Portugal emerged in 2008 with the publication of Decree- Law No. 39/2008, on 7 March 2008. In this context, it was stated that local accommodation should not be subject to the same rules governing the establishment, operation, and management of tourist enterprises. They only needed to meet safety and hygiene requirements.

After six years, a separate legal framework came into force for the operation of AL establishments under Decree-Law No. 128/2014, on 29 August 2014. After this came into force, the AL and short-term rentals began to have a real impact on the economy, which created the need for a more specific legal framework.

Alojamento Local: Legislation and Regulation

Articles 2 and 4 of Decree-Law No. 128/2014, of August 29, explicitly define the concept of Local Accommodation:

• Article 2: “Local accommodation establishments” are those that provide temporary accommodation services, namely to tourists, for remuneration, and that meet the requirements established in this decree-law.
• Article 4: AL establishments need to be furnished and equipped. They are offered to the general public and, in addition to providing a place to sleep, complementary services are provided, such as cleaning, for periods of less than 30 days.

Though it is initially straightforward to obtain an AL license in Portugal, regulations presented under the Mais Habitação (More Housing) Package (officially referred to as Law No.56/2023) in 2023 heightened the challenge for Portuguese investors seeking to leverage the nation’s thriving tourism industry by renting out their apartments on a short-term basis. However, as of 1 November 2024, however, many of these restrictions were revoked.

Alojamento Local Updates 2024

The new AL Law (Decreto-Lei n.º 76/2024) that came into force on 1 November 2024 introduced several changes, making it easier for investors to secure an AL license and benefit from short-term rental opportunities in Portugal. This includes:

• Nationwide transferability: AL licenses can now be transferred across all regions, including areas that were previously under contention. 
• Simplified approval process: It is no longer a requirement to get approval from the Condominium. 
• Renewal requirements: Existing licenses no longer have to be renewed every five years.
• Enhanced municipal powers: Municipalities now have the authority to approve an administrative regulation regarding AL activities in their respective territory. Municipalities with more than 1,000 registered accommodations are subject to a one-year deadline (counted from the day they reach the 1,000) to declare whether or not they will exercise this power to establish regulations. They must also create housing regulations by 31 October 2025. To guarantee the effectiveness of the municipal regulation, municipalities may, by a reasoned resolution of the municipal assembly and upon proposal by the municipal council, suspend authorizing new registrations in specifically designated areas for a maximum period of one year until the regulation comes into force.
• Local lodging ombudsman: On a municipal level, a local accommodation Ombudsman was established. They will now assist in managing disputes amongst residents, owners of AL establishments, and condominium owners or third parties, in addition to evaluating complaints and providing recommendations on the operation of ALs.

What are the capacity limits of an Alojamento Local?

Properties can host up to 9 rooms and 27 users, except for “rooms” and “hostel” types (previously allowed up to 30 users). If establishments can accommodate more, they will need to install convertible or supplementary beds as long as the total does not exceed 50 percent of fixed beds.

Process Before Asking for a Alojamento Local License

Before applying for an AL license, check where it’s possible to get one. Municipalities now have the authority to regulate AL approvals. For accommodation in Lisbon, at the moment, it is not possible to get an AL license for much of the city center. New AL holiday homes were recently banned in 19 Lisbon neighborhoods and eight parishes, with a complete ban on new establishments in Lisbon’s historic downtown. This was due to the oversaturation of AL licenses – for example, in Santa Maria Maior, almost 69 percent of all housing is given to AL. 

Municipal regulations may reintroduce restrictions, validity, and limits on the transfer of licenses. To preserve the social reality of certain neighborhoods and locations, the new decree-law states that municipalities will be able to approve containment areas and sustainable growth areas, by parish or union of parishes, in part or as a whole, where it will not be possible to secure a new AL.

• Containment areas are defined as areas where there is an overload in accommodation establishments that justifies restrictions on the installation of new establishments.
• Sustainable growth areas are defined as areas where special monitoring and oversight measures are warranted to prevent overloading.

Note that these areas need to be supported by specific studies and reassessed every three years, allowing limitations on new registrations and their transfer as “villa” and/or “apartment”.

The new rules allow for the containment and sustainable growth of areas within municipal regulations. Regulations now allow commercial establishments and services to be installed in properties that were constructed before 1951, provided they meet certain legal requirements. Under the new regime, oversight of AL rules is the responsibility of municipalities, removing the authority previously held by parish councils.

Obtaining an Alojamento Local Real Estate License

So, you have a lovely modern apartment in Portugal, and you’re looking to make a little extra cash on your investment. Perhaps you’re only in the property for part of the year and want to rent it out as a guest house while you are not in the country? Well, as we’ve mentioned, you’ll need to obtain an Alojamento Local license.

Registration and Licensing

To successfully obtain your AL license, you will need to be registered with the Portuguese Tax Department (Autoridade Tributária e Aduaneira) and Social Security (Segurança Social). This is required for you to be able to operate a rental business.

Note: Properties that are held by a company need to have a rental agreement in place with the individual. This is a requirement for the property to operate as a rental business. Working with a legal entity can help in this regard and make sure you adhere to the legal framework in place for short term rentals. Register a new service provision activity through the Tax Authority Portal or the physical Tax Office.

It is not as tricky as you may first imagine to register your AL license in Portugal.

1. Firstly, you’ll need to register your business activity with Finançes (Portuguese Tax Office). You can register a new service provision activity through the Tax Authority Portal or physically at the tax office.
2. Secondly, submit your AL registration to your local Câmara Municipal. To register for the National AL Registry, simply visit the gov.pt website and submit the required documents (see the section below for the documents that you will need to present). AL license Portugal registration processing can take up to 60 working days (approximately 3 months), though some municipalities process faster.
3. Register for AIMA for guest reporting.
4. Set up tourist tax collection, if applicable. This tax is required in certain municipalities, such as Lisbon, Porto, the islands, and a few other locations.
5. Register on the Livro de Reclamações (Complaint’s Book) website.

AL owners must also register with SIBA to report guest stays, ensuring compliance with immigration regulations. The official registry to verify Al Licenses can also be found here: RNAL Database. 

Alojamento Local Required Documents

To secure an Alojamento Local Portugal license, you will need to provide the necessary documents to the Câmara Municipal. An important aspect to consider is ensuring that all electric and gas installations fulfill the required standards.

• Proof of business activity registration for tax purposes with the CAE 55201 or 55204
• Caderneta Predial (Registration Certificate) for the property
• A simple copy of the identification document of the person responsible for the establishment. 
• Responsibility statement (Termo de Responsabilidade)
• A simple copy of the rental agreement or other document that legitimizes the operator’s right to conduct the activity
• Minutes of the condominium assembly authorizing the installation, in the case of hostels
• Civil liability insurance (Seguro de Responsabilidade Civil)
• Personal identification
• Insurance documentation
• Licença de habitação (Habitation License). Note for properties pre-1951, this document will be the Certidão de Isenção. 

If you are a non-resident, you will need to have a fiscal representative in Portugal who is registered for IVA (VAT). They can be an accountant or a specialized company.

After prior communication, an inspection will be carried out. During this time, the Mayor can also oppose the license. After this, the activity is open to the public,

General Requirements of an Alojamento Local Property

Local license holders will need to meet the following general conditions. The Food and Economic Security Authority (ASAE) can carry out inspections to make sure all the legal requirements are followed, so it is important to ensure that everything is in order.

• The internal and external premises need to be maintained and in good condition. There needs to be an adequate standard of cleanliness and hygiene. 
• The cleaning of the premises, including the changing of bed linen and towels, needs to take place at least once per week or whenever there is a new guest. 
• There needs to be a private system with a controlled water supply, or the premises must have mains water connected. 
• The premises need to be supplied with both hot water and cold water.
• The premises need to be linked to the main municipal drainage system or have a septic tank adequate for the number of guests.
• The premises must have one private bathroom with a toilet, wash basin, and shower/bath for every three bedrooms. 
• Each private bathroom needs to have a secure lock system to ensure the privacy of occupants. 
• Each room that is to be occupied by a guest needs to have a window or balcony with direct access to the outside so that there is adequate ventilation. 
• Each room that is to be occupied by a guest needs to have a means of blocking external light. 
• Each private room to be occupied by a guest needs to have a locking system to ensure the privacy of occupants. 
• The premises must observe general rules with respect to fire safety. There needs to be an adequate number of fire extinguishers and a fire blanket accessible. The national emergency number for Portugal (112) needs to be displayed clearly.
• Noise rules should be clearly visible.
• The premises need to have adequate first aid equipment that is accessible and provide instructions for the domestic appliances. 
• Any commercial documentation, publicity, or marketing materials on the premises need to show the name of the premises followed by “Alojamento Local” or the letters “AL’, alongside the AL Registration Number. 
• The premises are required to have a complaints book. This should be kept where guests have easy access to it and should include a notice to that effect. 
• There should be an information book in four languages. 

What price should you charge for your Alojamento Local?

You should indicate the average price per night clearly. You can have a look at room deals for similar properties on the market and seek expert advice to determine the price you should set, which will perhaps vary depending on location, the season, etc. Also factor in additional and fixed costs. Make sure to add in your unique value offer and why potential guests should choose your accommodation.

Property Management

Working with a property management company is a smart move to ensure the smooth running of your property. With short-term rentals, tenants will come and go in quick succession, so ensuring that everything, from the booking process and tenant communication to cleaning and maintenance, is in order is essential.

Management companies typically seek a commission of around 20-30 percent, plus VAR. For mid-term rentals (more than three months), many consider a reduced commission of 5-7.5 percent, with it usually possible to negotiate based on the services required.

Standard services include:

• Booking management
• Cleaning and maintenance
• Handover of the keys to the tenant
• Local support
• Registration with AIMA
• Tourist tax collection
• Issuing green receipts
• Some companies may also offer revenue management

Guest management

• You (or you’re property management company) must register non-Portuguese guests with AIMA within three days.
• Only guests who are not Portuguese citizens need to be registered
• For longer stays, register check-in data immediately and update the check-out date as soon as it is known.
• Maintain accurate records of guests
• Collect and report tourist tax (if applicable)
• Provide emergency contact information and have clear contact details provided for guests of who to contact in case they require assistance
• Have clear check-in and check-out procedures and ask about your guest’s expected arrival time and departure time so they can have a stress-free check-in and check-out. Have prior communication with your guests to ensure that they are aware of the check-in procedures and give them prior notice of relevant information about their upcoming stay.
• Display house rules and local information
• Have a special requests box (if desired) as going above and beyond will lead to very positive reviews and higher tenant occupancy in the long run

Property-set-up recommendations

• Have a fridge with a freezer compartment is recommended
• Have an anti-bed bug mattress protector is essential
• Get professional photography for marketing and listing purposes
• A standard power supply (10.25kVA) is usually sufficient
• Consider separate electrical circuits for high-consumption appliances

Property Setup Recommendations

• Having an under-counter fridge with a freezer compartment is highly recommended
• Anti-bed bug mattress protectors is essential
• Professional photography is crucial for listings and marketing purposes
• A standard power supply (10.25kVA) is usually sufficient
• Consider separate electrical circuits for high-consumption appliances

Alojamento Local: Best Practices and Tips

Below we share some top tips and best practices to ensure that you get the most of your investment and that you avoid running into any legal or financial troubles.

Business management

• Consider using an accountant to ensure that you understand all your financial responsibilities and make the necessary payments.
• Keep separate business bank accounts to keep everything well organized and keep track of each bank transfer.
• Take into account the tax payments that you will have to pay and when these financial obligations are required.
• Monitor regulatory changes regularly.
• Commit to regular financial reviews (with your accountant if you have one)
• Track expenses carefully.

Risk management

• Screen guests carefully
• Document the property’s condition and any works that may be needed
• Maintain adequate insurance
• Build good relations with your neighbors
• Carry out regular property inspections
• Have an emergency contact list
• Have a strong local support network in case something happens when you are not available.

Rental contracts

• For short-term rentals under Al use a prestação de serviços de alojamento local, while for mid and long-term rentals, use contrato de arrendamento por fins transitórios. There is no minimum duration requirement for mid and long-term rentals.

AL License Transfer Process

The AL License transfer process can be done:

• Online with Chave Móvel Digital
• In person at the Câmara Municipal

The documents that you will need include:

• A copy of ID/passport
• Property tax document (Caderneta Predial)
• Business activity registration
• Licença de Utilização (for post-1951 buildings)
• Copy of your AL insurance policy

Other Factors to Consider Regarding Your AL Property

The following are some factors that you should consider if you are thinking about buying a property in Portugal and renting it out in the short term. You should ensure that you have furnished accommodation and that guests have everything they may require, alongside the following.

• Leave a place for guest reviews online to attract tenants. Feedback from real guests provides valuable information to individuals looking for short-term rentals.
• If there is free parking nearby, specify this, as it will be useful information for verified guests arriving by car.
• Consider whether you will have free cancellation, if you will have paid reservations, and when you will collect the payment from your guest
• If you have free wifi, specify this.
• If you have a double bed or king-sized bed, specify this alongside the pictures. Also specific if you have extra beds.
• If there is a private bathroom or en suite private bathroom, make sure this is clear, as it can be important information for potential guests.
• Make it known that the property has non-smoking rooms and indicate this clearly to guests.
• Ensure an easy process for accepting guests to stay in the property and make sure that the check-out process is clear.
• Ensure that safety measures are all in place and such guidelines are followed to the letter (e.g., the property ensures adequate ventilation, fire safety, first aid, the security system, and emergency number information is displayed clearly) and that you clearly state the maximum capacity of people that can stay in your property. Government guidelines exist for the safety of the guests.
• Direct communication between the guest and you, the owner, or your property management company will ensure that problems are solved as quickly as possible.
• Online travel booking is now the norm, so ensure that your listing is appealing to potential guests. If you have a swimming pool, beverage service, coffee machine, or other notable amenities, facilities, or related services on your property, you can include them on your listing. You can also add in laundry or other services you can provide, for an additional fee. It can also be a nice, personal, touch to have a bottle of Portuguese wine and water ready for when tenants arrive, as the little touches can go a long way in getting good reviews.
• Indicate useful services and information for guests, such as excellent restaurants close by, how to get to the city center, popular landmarks, etc.

Insurance and Safety

Investors will need to take out public civil liability insurance, which is available through ALEP membership, and which clocks in at €88 per year. Holders of local accommodations located in buildings under the horizontal property regime must also have insurance coverage for fire risks.

One ALEP membership can cover multiple properties, although additional properties require a small supplement (under €40 each). ALEP insurance covers up to €75,000 for guest liability only

The holder of the local accommodation operation must enter into, and maintain valid, a non-contractual civil liability insurance policy that covers property and non-property damages caused to guests and third parties, arising from the provision of accommodation services. The minimum capital for the insurance contract is €75,000 per incident.

Alongside public liability insurance, additional recommended coverage includes:

• Regular property/building insurance (multirisco)
• Property damage
• Contents insurance
• Loss of income coverage
• Earthquake coverage
• Alternative accommodation coverage

It’s important to note that having adequate insurance is now strictly enforced. For example, ASAE suspended an AL in Olhão for not having mandatory insurance. 

Recommended insurance brokers:

• Abbeygate Insurance – Provides tailored insurance for AL properties
• Zurich Insurance – Provides ALEP-affiliated insurance

Safety Equipment Requirements

As we’ve mentioned, you will be required to have the following safety equipment to rent out your property short-term. You will also need to make sure you carry out regular maintenance checks.

• Fire safety equipment, including a fire extinguisher(s), a fire blanket, smoke/carbon monoxide detectors, and emergency lighting
• A first-aid kit
• Emergency information and safety signage that is clearly displayed

Online Platforms and Marketing

When it comes to advertising your property, online platforms will differ in terms of commission. Below, we outline what you can expect from two of the most popular online platforms.

Airbnb

• Airbnb is now a world leader when it comes to group and solo travelers seeking an easy accommodation experience
• Airbnb takes a 3 percent commission when listing the property directly without a channel manager
• If using the channel manager or property management software, you can expect Airbnb to take a 15 percent commission.
• Airbnb handles tourist tax collection in some municipalities.
• AirCover damage protection

Booking.com

• Booking.com takes a 15-20 percent commission
• Booking.com has different payment collection options, and you can set damage deposit requirements
• Booking.com, as with Airbnb, now collects tourist tax in some municipalities
• Booking.com monitors combined discounts, for example, from Genius, the Booking.com Loyalty Program, and weekly stays.

Platform Management Tips

If you are marketing your property on various online platforms, we recommend maintaining consistent pricing across the different platforms. Alongside this, keep the following in mind:

• Respond promptly to inquiries.
• Keep calendars synchronized across platforms.
• Focus on gathering positive reviews as this will create a positive feedback loop and ensure you constantly attract tenants throughout the year.
• As we’ve mentioned, invest in professional photography to advertise your property.
• Set clear house rules, such as noise restrictions at night, and have an accurate list of amenities.

Channel managers

If you are seeking out channel managers, some popular options are:

• Guesty
• Lodgify
• Your Porter
• Talkguest – Highly recommended channel manager with SIBA integration and with invoice management
• Octorate – Alternative channel manager with AI-powered communication

Record Keeping

You will need to ensure you keep the following records and, for this, we recommend working with experienced professionals who can assist you to ensure a streamlined process and that records are accurately maintained and updated accordingly. 

• Guest identification and registration 
• Tourist tax payments 
• Maintenance and repairs 
• Financial records 
• Safety equipment inspections 
• Regular digital backups
• Regarding guest identification and registration, AIMA requires the reporting of the details of all foreign guests staying in apartments and hotels within the national territory. You will need to provide the following information: 
  • Full name
  • Nationality
  • Date of birth
  • Document number
  • Document type
  • Issuing country of the document
  • Country of residence
  • Check-in and check-out date

Internet, Utilities, and Key Management

You’ll want to ensure you have good internet and get your utilities in order, working with service providers that you trust.

Internet packages

When it comes to internet solutions, decide what is best for you and whether you are seeking temporary options, such as a portable hotspot, or a no-commitment contract that will come at a higher cost. You can also shop around for the best option and deal right now.

Utilities

It’s important to consider the following when it comes to utilities to save money over the long run.

• Some areas charge commercial rates for AL properties which can be changed back to residential rates if it is the primary residence.
• Make sure to monitor usage patterns, consider smart thermostats, and think about installing motion sensors for air conditioning control.

Key management and handover

When it comes to handing over the key(s) to the new tenant, there are several options, whether you do the traditional key handover in person (or through an agent), key safes, smart locks, or enlist the help of key management services, such as KeyNest.

Goldcrest: How We Can Help You 

Goldcrest is a buyer’s agent that is based in Lisbon. We provide expert, impartial advice on real estate investments and how to buy property in Portugal. From scouting out the perfect property through to property acquisition, we have you covered throughout the process.

If you are looking to purchase property in Portugal, don’t hesitate to get in touch. Our team of skilled experts is available to solve all your real estate doubts, helping you with the property search and offering insightful expertise and strategic advice.

Why choose Goldcrest?

• Local knowledge: With offices located across Portugal, our presence nationwide allows us to assist you personally across the country.
• Independent service: As an independent buying agent, we do not represent any development or project. Our service is entirely tailored toward each individual client, providing you with everything you need to secure the perfect property at the best possible price. As an impartial advisor on the market, we work solely on behalf of our client and provide a service tailored to your needs and requirements.
• Streamlined process: Our real estate agents speak English and Portuguese, and our service is completely focused on providing you with a hassle-free buying experience, saving you time.
• Experienced team: Our expert real estate team has a vast local knowledge of the Portuguese property market. We have cutting-edge technology and metasearch tools at your disposal to provide full market coverage, ensuring the best investment choices and negotiated prices.
• Network of partners: We have a close network of partners, including lawyers, property management services, builders, architects, designers, and landscape gardeners, again saving you time and hassle by providing you with trusted experts in their field of work.