The new Land Law (Decree-Law No. 117/2024, of December 30th) was recently published, amending the Legal Regime of Territorial Management Instruments (RJIGT). This legislation is part of the “Building Portugal” plan, aimed at increasing the supply of affordable housing and supporting the sustainable development of cities.
However, an important misconception needs to be clarified:
This law does not allow a private landowner to directly reclassify rural land as urban. The reclassification decision is exclusively in the hands of municipalities, which may propose changes to the Municipal Master Plan (PDM) to enable new housing developments, but only under exceptional circumstances and strict conditions.
What changes with this new legislation?
The law introduces a Special Reclassification Regime for Urban Land, applicable only when:
- The municipality decides to reclassify rural land as urban through a simplified amendment to the Municipal Master Plan.
- At least 70% of the above-ground construction is designated for public or moderately priced housing.
- The reclassification ensures adequate infrastructure, green spaces, and public facilities.
- The area is not located in protected zones, such as the National Ecological Reserve (REN) or the National Agricultural Reserve (RAN).
What remains the same?
- Individuals cannot purchase rural land and request the municipality to convert it into urban land.
- There is no liberalization of indiscriminate urbanization. All reclassification processes must follow established urban planning criteria and be approved by municipalities.
- Changes in land status cannot affect floor risk areas, protected coastal zones, or high-productivity agricultural land.
Who decides and how?
The Municipal Council proposes and the Municipal Assembly deliberates on the reclassification, ensuring a transparent and collective decision-making process. This measure prevents arbitrary individual decisions and ensures that urban growth occurs sustainably.
Furthermore, if an area is reclassified and urban development projects are not executed within the defined period (a maximum of 5 years, extendable only once), the reclassification automatically expires.
Conclusion
- If you are considering investing in land for urban development, it is crucial to understand that this legislation does not grant individuals the power to alter land classification.
- The decision exclusively belongs to municipalities and follows strict territorial planning criteria.
Source: ProjSul – Architecture and Engineering - www.projsul.com
