The Supreme Court of Portugal ruled that accommodations in residential buildings cannot be rented for tourism, a decision that could affect touristic cities like Lisbon and Porto.
In a ruling issued on March 22 and reported by Público, the Supreme Court of Justice of Portugal considered that private accommodations in residential buildings are not meant for short-term touristic stays.
The decision standardizes two different case laws in the country and rules against the coexistence of permanent and tourism-related temporary housings in condominiums that are dedicated to permanent dwelling.
The decision will potentially have huge impact in cities where rooms and apartments are rented for tourists on Airbnb and the likes.
The ruling from the highest court of law in Portugal settles two contrary justice decisions. The Appeal Court of Porto ruled in favor of permanent residents who don't want strangers to come and go continuously in a residential building while the Lisbon Court considered that owners had the right to allocate their property for other uses than permanent housing.
The decision is about alojamento local, Portuguese for local lodging, in residential buildings. An alojamento local is a generic name in Portugal referring to various types of accommodations for tourism like a Bed and Breakfast, a room, an apartment, a hostel and also individual houses. But the ruling is more specifically for alojamento local in condominiums and permanent residential buildings shared by different owners.
With the court decision, one of the judges foresaw "an avalanche of lawsuits" that will ask for closing tourism rentals.
There are about 65,000 alojamentos locais registered throughout Portugal according to the Association of Local Lodging in Portugal (ALEP). But not many lawsuits are to be expected, the board reacted to the news reports in a Facebook statement.
A law passed in 2018 introduced a special regime for the alojamento local. It provides a simplified procedure for condominiums that seek to close touristic accommodations when they repeatedly disturb residents. According to ALEP, there were fewer than 50 requests in 2018 and it argues that conflicts are in reality exaggerated by media reports.
However, the law requires that at least half the owners of the condominium are grouped to ask for closing a touristic place. And this is only possible for a time period of up to one year, in case of "reiterated practice of acts that disturb the normal use of the building, as well as acts that cause nuisance or affect the rest of the condominium owners," according to the Order of Attorneys of Portugal.
And so it's unsure how owners and condominiums may react now that the justice decision has been made clearer.