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Local Accommodations Hit a Wall in Lisbon

26 April 2019 – Richard D. K. Turner

After a banner year in 2018 for the Local Accommodation sector (AL) has hit a wall in Lisbon.

The capital city’s municipal government granted 478 licenses for new units in the capital, compared to 1,123 in the first quarter of 2018 – a 60% drop. According to the Portuguese Association of Local Accommodations Portugal (ALEP), the drop affected every parish in Lisbon, and the fall was well above the national average. Nationally, there were 2,321 new registrations in the first quarter of 2015, increasing slightly to 2,364 in the same period of 2016 and to 2,677 in the same period of 2017. 2018 saw a major rise to 5,518 new registrations, subsequently falling to 3,283 in the first three months of 2019.

The fall in Lisbon is largely seen as a result of two factors: new regulations placing limits on the growth of new accommodations in specific areas of the city and a maturing market for the product.

The neighbourhoods of Bairro Alto, Madragoa, Castelo, Alfama and Mouraria, where new registrations of local accommodations have been suspended since November of last year are expected to be declared areas of “absolute containment,” meaning that ALs already account for over 20% of lodging in the area.  Any new ALs will not be permitted unless they result from the rehabilitation of previously ruined buildings.

Areas like Graça and the Colina de Santana, where ALs already account for between 10 and 20% of existing lodgings, are expected to be named areas of “relative containment.” Such areas will be subject to restraints on the number of new ALs in the future. New proposed regulations would also allow condominium boards to effectively bar ALs with individual buildings.

Original Story: Idealista

Foto: Claudio Schwarz

Translation/Summary: Richard D. Turner