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What challenges do the new land laws present for home builders?

The new land laws in Portugal come with a unique set of challenges for home builders that must be thoroughly understood. While these new regulations allow construction on rural land, creating more housing possibilities, there are complexities that builders need to be aware of. One significant concern is the mandatory allocation requiring 70% of the area to be for public or affordable housing, which could limit diversification of development projects. Furthermore, the legislation introduces additional infrastructure costs necessary for the development of these lands, impacting budgeting and profitability. These challenges must be carefully navigated to avoid potential delays or financial losses. The potential for varying interpretations of the law presents another layer of uncertainty that builders must manage; effective legal counsel may be required to ensure compliance and mitigate risks. Networking with local officials and understanding municipal plans will be paramount in adapting to these changes. It's also essential to monitor the market response and adjust business strategies accordingly. Savvy builders will need to engage in proactive planning to harness these opportunities while managing the associated risks effectively. Staying informed and prepared will ensure successful project completion and profitability in this changing landscape.

Monday, 06 January 2025 - News
What challenges do the new land laws present for home builders?

But the mayors warn that the diploma brings doubts and challenges, opening the door to the construction of other real estate projects in addition to houses. Furthermore, this new land law is not articulated with other laws exerting pressure on urban management.

The warning was given by the National Association of Portuguese Municipalities (ANMP) which gave its opinion on this new soil law. This diploma published in the Official Gazette of the Union this Monday, December 30th, already has the contribution of the mayors. And it will come into force within a month.

Although admitting to idealista that this new law could bring more houses to the outskirts and at lower prices, the ANMP led by Luísa Salgueiro now warns that this decree-law opens the door to the construction of other types of projects on land rustic, he told Jornal de Notícias. Keep in mind that the degree only requires that the majority of the area (at least 70%) be dedicated to public housing, affordable rental, or moderately priced housing.

Furthermore, the construction of houses (and other projects) has to take into account additional infrastructure costs, as land needs to be developed. And the mayors also warn that the new land law has gaps, which could generate different interpretations, and will also bring “great pressure to urban planning and management”, as it will touch on the Municipal Master Plans already approved by various entities, the same reads publication.

The President of the Republic had also warned, when he promulgated the decree-law on Thursday (26 December), that the new land law will cause “a significant disruption” in the territorial ordering and planning regime.

Because of this the ANMP now states that it doubts that the new land law will solve the problem of the lack of affordable homes for the middle class.

 

Source: https://www.theportugalnews.com/news/2025-01-04/new-land-laws-bring-doubts-and-challenges/94637

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