What changes with the new Local Housing Law?

Law 62/2018, of August 20, which carries into effect the second amendment to Decree-Law No. 128/2014, of August 24, which regulates the authorization system for operating local housing establishments, has already entered into force on October 21st. Among the main changes, we highlight the possibility for local authorities to create “containment areas”, the powers conferred on the tenants’ association to condition or even block the exercise of the activity of operating a local housing business.

Expansion of the powers of municipalities

Among others, this judicial amendment had in mind the objective of “preserving the social reality of neighbourhoods and places“, in order to avoid the gentrification of certain areas.

As from the entry into force of the new law, the local competent municipality may impose limits on the creation of new local housing businesses, which are referred to as “containment areas”, in which no local housing businesses can be created without the express authorization of the local municipality.

Article 15 also stipulates that in containment areas “the same owner may only operate a maximum of seven local housing businesses”.

Powers of the tenants’ association

This new law came to give the tenants’ association a role that, although not corresponding to the one demanded by some sectors, is still important in the context of the operation of local housing businesses.

This intervention, which is stronger in the case of the licensing of so-called hostels, since in the prior notification process addressed to the competent Mayor of the City, which initiates the licensing procedure for this type of local housing establishments, it is the minute of tenants’ association that authorizes the intended establishment of this particular type of establishments, according to Article 4 (4) and point (f) of Article 6 (2).

The tenants’ association also has the power to oppose the establishment of a local housing business, in cases where it is established in an apartment of a building or part of the building susceptible of independent use, based on the recurrent and proven practice of acts that disturb the normal use of the building and also of acts that call into question the right to rest of the other tenants, in accordance with Article 9 (2).

The tenants’ association may also set an additional contribution corresponding to the expenses resulting from the increased use of the common parts, with a limit of 30% of the annual value of the respective quota in accordance with Article 20 (a), but this amendment, like other changes made, is subject to the two-year moratorium that the law provides for adapting to some of the new rules.


 Artur Filipe da Silva, lawyer and partner at BAS, e José Sousa Carneiro, trainee lawyer


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