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With the aim of fixing the country's housing crisis, the government's Mais Habitação law has had a huge impact on several areas in the real estate market. Among them were the changes to the Golden Visa and Non-Habitual Resident programmes.

Another segment targeted was short-term rentals, also known as Local Accommodation (AL) in Portugal, with the government imposing new requirements for those renting out their properties.

But now, the Infrastructure and Housing Minister Miguel Pinto Luz has announced that each local municipality will be able to decide on new AL licences, as well as confirming the repeal of the extraordinary tax on this sector.

For the Portuguese Local Accommodation Association (ALEP), the government's measures to allow municipalities to decide on granting new licences are positive, but with a “wait and see” stance.

“The municipalities will have a say in this,” stressed the minister, adding that the decision will be “autonomous” while being “in line with general legislation”. In any case, the government doesn't necessarily oppose the prohibition of new licences.

According to Miguel Pinto Luz, “what was wrong with the previous law” is “treating objectively different things as equal”. While the limitations perhaps made sense in Lisbon, he said, the AL developments in the Algarve, for example, aren't the same.

Eduardo Miranda, president of ALEP, views the decision “as something positive”, but emphasises the need to wait for a complete proposal. He advocates for intelligent regulation to guide the sector's development without creating pressure on permanent housing.

Investing in real estate for rental purposes (buying to rent) has long been a popular choice for property buyers, so it's understandable that recent limitations may have caused some apprehension.

Local experts like Algarve Home Sales can provide valuable insights on buying property in the Algarve, whatever its purpose. Get in touch for more information.