Short Term Rentals in Portugal: 2024 Update

The AL License is a license that is required for investors looking to rent out their property for short-stay rentals. Without it, you cannot register your property on platforms such as Airbnb or booking.com. While it was relatively easy to secure an AL License, new restrictions made it more difficult for investors in Portugal who wanted to rent out their apartments on a short-term basis to capitalize on the country’s booming tourism sector. However, as of October 2024, these restrictions have eased, as we highlight below.

Latest Changes: 23 October 2024

The Portuguese government has recently introduced crucial amendments to the regime for local housing under Decree-Law No. 76/2024, published on 23 October 2024. These changes (stated in Decree Law No 128/2014 of 29 August) roll back certain restrictions that were imposed by the Mais Habitação (More Housing) program in 2023 and aims to align AL regulations with residential market needs and strengthen confidence in the rental market.  

As such, 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. 

 Municipalities may suspend new AL registrations for up to one year until regulations are in place, in designated containment areas and sustainable growth areas. 

 What are the changes? 

In short, this package, to respond to problems and complaints associated with the AL, has revoked the following: 

• Suspending the issuance of new registrations of AL establishments; 
• Expiry of inactive registrations when there was no proof of the maintenance of the activity; 
• Non-transferability of licenses; 
• The requirement to review in 2030 all existing records on the date of publication of the Mais Habitação program (2023);  
• The rule providing that AL registrations were valid for renewable five-year periods; and 

In addition to this: 

• The condominium assembly of a building where an AL is installed is given the power to oppose the operation and can request the municipal president to cancel the registration.  
• AL capacity is now also capped at a maximum of 9 rooms and 27 guests. 
• Creation of an Ombudsman, on a municipal level, to handle disputes and provide recommendation on the operation of ALs.  

From 1 November 2024, these new changes came into force. 

Please check out our article, which has a full rundown of the latest changes regarding AL licenses in Portugal: https://portugalbuyersagent.com/alojamento-local/. 

Short Term Rentals in Portugal

Portugal registered a record number of tourists in 2023, closing the year with 77 million overnight stays and €25 billion in tourist revenue. This represents a growth rate of 10 percent and 37 percent growth, respectively, when compared with 2019 figures, according to the National Statistics Institute (INE), the Bank of Portugal, and Turismo de Portugal. Discover more about the current state of Portugal’s tourism sector in our Portugal tourism guide.

Record tourist numbers have fuelled the interest of many investors looking to capitalize on Portugal’s continuous tourism boom.