The new regulations, which remain open for public consultation until 15 April, provide for a total ban on new units in the entire historic area, much of the riverside area and the city centre.
The decision is based on the percentage of existing AL in relation to the number of family homes, with more restrictive rules being applied in areas with high saturation, according to Público.
The areas of greatest restriction include eight central parishes – Santa Maria Maior, Misericórdia, Santo António, São Vicente, Arroios, Estrela, Avenidas Novas and Alcântara –, classified as being in “absolute containment” for exceeding the limit of 5% of local accommodation in relation to conventional housing.
In addition, there are 19 neighborhoods in eight other parishes that will also be subject to a total ban on new ALs. Parishes in “relative containment”, where the index varies between 2.5% and 5%, will have a reduced margin for opening new establishments.
The parish of Santa Maria Maior, which includes the heart of the historic center, is the most saturated, with 68.8% of households converted to AL, followed by Misericórdia, with 44.9%.
It seems like the most logical approach is to rescind a lot of AL licenses that were already granted to get the total number far lower and then reevaluate. Start by rescinding any AL licenses that haven’t reported significant income in the past 2 years (understanding many of those owners are renting but are illegally avoiding paying tax). Hard for them to argue they deserve an AL license that isn’t being used regularly or that they are using but not paying tax on. What income threshold is fair? I don’t know, but perhaps those reporting under €4-5k/yr? Anything below that and you are obviously barely using it as a rental.
This can be done quickly and easily by tax query. People will still rent illegally obviously, but it would put many apartments back on the long term rental market. Then, give larger tax incentive (lower tax rate on income) for long term rentals.
See how that shakes up the market over 2 years and then reassess if the market can handle more AL licenses or not.
By Jeff from Lisbon on 15 Mar 2025, 11:39