What are the risks of buying a property with a local accommodation licence in Lisbon?
Buying a property with a local accommodation licence in Lisbon poses specific risks, primarily related to the potential for license cancellation. Recently, around 75% of local accommodation licences in the city are reported to be at risk amid the new ‘More Housing’ programme. Property owners must submit a proof of activity document by December 7 or face automatic cancellation, a situation that could undermine investments. Without this documentation, you are not just vulnerable to losing your license, but you could also struggle to realise the rental income potential of your property. Being proactive and understanding the requirements can safeguard your investment, making it crucial for buyers to stay informed about regulatory changes. Properties close to amenities in Lisbon may still offer good ROI, but careful consideration is vital before making a purchase. Engaging with real estate professionals who understand local regulations can further mitigate risks. Explore properties that stay compliant to maximise your investment. Ultimately, due diligence is essential to ensure you are making a sound investment. Contact us now to learn more about property opportunities that are compliant with the new regulations!
As the ‘More Housing’ programme comes into force, property owners with active LA licences have a window of two months — which ends on December 7 – to deliver a proof of activity document or face their licences being cancelled automatically by municipal councils.
In Lisbon, out of a total of 20,033 active licences, only 4,730 applications for a proof of local accommodation document have been submitted according to Lisbon City Council. In other words only 23.6% of the renewal applications have been handed in.
In Porto there are less registrations under threat. Out of a total of 10,520 active licences on the National Local Accommodation Registry to November 30, 6,041 applications for proof of activity were delivered (57%) but just two weeks prior, only 1,300 had been handed in.
Under new regulations for LA within the ‘More Housing’ programme, all active licences that are cancelled will be prevented from being revalidated at least until 31 December.
In other words, up until this date new local accommodation licences will be suspended with the exception of hostels and guest houses and LAs in the interior of Portugal, Madeira and the Azores.
Also not included in this suspension are local accommodations in which the proprietor actually lives provided that the owner does not rent the property out for more than 120 days per annum.
