Lisbon Authorities to Cancel Thousands of Short-Term Rental Licenses by Year-End
Municipalities across Portugal are preparing to cancel thousands of Alojamento Local (AL) licenses before the end of the year, a development directly impacting the short-term rental market. The move comes as nearly 40% of the 125,749 registered AL properties in mainland Portugal and the islands have failed to communicate proof of mandatory insurance to the national tourism authority, Turismo de Portugal. This lack of compliance places approximately 50,060 establishments at risk of having their operating licenses suspended by local authorities.
The new requirement was introduced under Decree-Lei n.º 76/2024, which came into effect last November. However, enforcement only began in mid-March of this year, after a digital mechanism was established by the Agency for the Technological Reform of the State (ARTE) to allow property owners to upload their insurance policy details to the Registo Nacional de Alojamento Local (RNAL). Despite a six-month awareness campaign and direct notifications to owners, a significant number of registrations remain non-compliant. The Local Lodging Association in Portugal (ALEP) has stated its belief that a majority of these 50,060 properties are likely inactive.
Under the law, there is no fixed deadline for uploading the insurance information, which must be renewed and resubmitted annually. However, failure to comply can result in the suspension of the license. The task of fiscalization falls to municipal councils in partnership with the Autoridade de Segurança Alimentar e Económica (ASAE). These bodies are authorized to conduct inspections and demand documentary proof of a valid insurance policy. According to Turismo de Portugal, this enforcement has already led to the cancellation of 14 registrations for non-compliance, with six of these occurring within the municipality of Lisbon, a key market for investment properties.
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The regulation aims to bring more accountability to the burgeoning short-term rental sector, which has seen explosive growth in recent years. For property investors, particularly those from abroad, this highlights the critical importance of staying current with regulatory and legal frameworks. The financial implications of a license suspension could be significant, interrupting rental income and potentially leading to further penalties. This development serves as a reminder of the need for diligent property management and legal oversight in the Portuguese market.
As municipalities prepare to act on non-compliant listings, the focus sharpens on the professionalism and sustainability of the tourism accommodation sector. This regulatory tightening could influence market dynamics, possibly reducing the supply of available short-term rentals and impacting yields. Investors and owners are advised to verify their status on the RNAL platform and ensure all legal obligations are met to continue operating without interruption. Discover rental property opportunities and regulations at realestate-lisbon.com.