Two sets of legislation co-exist to regulate different types of rental activity.
On the one hand, holiday lets in Empreendimentos turísticos (tourist developments) such as hotels, holiday complexes and camping facilities are defined and regulated under Decree Law nº 167/97. This has been altered and republished under Decree Law nº55/2002, which decentralises many responsibilities from the central tourism bureau (Direcção Geral de Turismo) to local town councils (câmaras).
Government inspections launched a mega operation last week targeting holiday villas and rental accommodation across the Algarve. A total of 147 fines were issued for various infractions, but primarily to property owners not holding the requisite rental licence.
The problems affecting the licensing of properties for rent deepened this week.
A villa owner in Quinta do Lago made public some documents that show it is impossible to obtain the necessary licence to rent a private villa to holidaymakers.
Background – raids on rentals This is the first in a seven part series on licensing requirements for holidaylets.
Background – raids on rentals Tourist lodgings – A casa turística Licensing requirements – presenting a plan The guest house – A hospedagem Renting – o arrendamento urbano Compliance – getting it right Conclusion – not so bad after all In the summer of 2005, Inspectors from the Inspecção-Geral das Actividades Económicas (IGAE) raided rental agencies in the Algarve, demanding to see letting permits. These permits/licences should have been issued by the local council in order for the accommodation to be rented to tourists, as required by law since 1997. Those practising this letting activity were often unaware of any such prerequisites and the inspectors proceeded to fine both agents (between 2,500 and 30,000 euros per infraction) and owners (from 500 to 3,740.90 euros). One agency was fined a total of 150,000 euros. These investigations were part of an overall strategy to tighten up procedures and law enforcement. According to the Direcção Geral de Turismo (Tourism Bureau), approximately 4,000 notifications were sent out to update registries, in addition to parallel inspections like those that occurred in the Almancil area. Throughout the 16 councils of the Algarve– the official entities charged by law to regulate and license the holiday letting practice – one would be hardpressed to count on the fingers of one hand, the licences actually issued since the current legislation came into effect in 1997. Owners and agents now find themselves penalised for not having a licence, which, in many câmaras, does not yet even exist. Given the “Catch 22” nature of the whole affair, confusion and consternation abound. Naturally, these events have brought an upsurge of alarm to the foreign resident community in the Algarve, reminiscent of the shock waves sent out when property reform legislation attacked offshore companies several years ago. Once again, understandable and necessary changes have been brought into place in a rather clumsy and poorly thought out process that rapidly turns intoa nightmare for all concerned.
Many people who own a property in Portugal, may it be a villa or an apartment, let these to third parties. They do this either by their by using their own marketing, the use of a rental agent, estate agent or a combination of these.
Now Portugal has become a rather popular holiday destination, many people also may consider this country as a more permanent base for the future to retire. As settling here definitely and buying a property straight away may for some people just a to bigger step at once we get many requests for people who before committing to the sale of their property at home have the idea or dream to first rent a property for a longer period.
