DL 76/2024 and the Algarve: a reset, not a free-for-all

On 23 October 2024, Portugal's government published Decreto-Lei n.º 76/2024 in the Diário da República. Eight days later, on 1 November 2024, it came into force — and with it, most of the short-term rental restrictions introduced by the previous government's Mais Habitação programme (Law 56/2023) were reversed. For villa owners across the Algarve, from Tavira to Lagos, the implications are significant and, in several respects, immediately actionable.

This article sets out the six key changes introduced by DL 76/2024 Algarve owners need to understand, along with the important caveats that remain in municipal hands.

AL licences are now permanent

Under Mais Habitação, all alojamento local (AL) licences were given a five-year validity period, with mandatory renewal. For owners who had operated their properties as short-term rentals for years, this created genuine uncertainty about continuity — and a hard deadline that loomed over every property valuation.

DL 76/2024 abolishes that expiry mechanism entirely. Your AL registration number does not expire. There is no renewal procedure to follow, no 2030 cliff edge to plan around. The licence exists for as long as the registration remains compliant and in good standing.

One important caveat: individual municipalities retain the power to introduce their own renewal conditions through local regulation. No Algarve câmara has yet done so, but owners in municipalities with more than 1,000 AL registrations — which includes Albufeira, Loulé, and Lagos — should monitor local council decisions, as those councils are required to set their own rules within 12 months of the law's publication.

Licences now transfer with the property

This was perhaps the most commercially damaging feature of Mais Habitação: AL licences had become personal and non-transferable, tied to the original applicant. Selling a property meant the incoming buyer would need to apply from scratch — with no guarantee of approval under the then-prevailing national freeze.

DL 76/2024 restores transferability. When a property with an active AL registration is sold, the registration number transfers to the new owner. This applies to both individual holders and corporate entities. Estate agents and solicitors in the Algarve have already begun reflecting this in property valuations, particularly for villas in Loulé, Lagoa, and Portimão where rental yields are a central part of the investment case.

The licence exists for as long as the registration remains compliant — no expiry date, no renewal deadline, no cliff edge.

The national freeze on new licences is over

Mais Habitação introduced a de facto ban on new AL registrations across most of Portugal. DL 76/2024 lifts that ban at the national level. New registrations are once again open throughout the country — including in coastal municipalities — except in areas formally designated as zonas de contenção (containment areas) by local councils.

As of the date of publication, none of the principal Algarve municipalities — Albufeira, Faro, Lagos, Lagoa, Loulé, Portimão, or Tavira — have been designated as national-level containment areas. However, each câmara has the authority to declare containment zones within its own boundaries. Owners considering new registrations should verify the current position with their local council before proceeding.

Condominium approval: scrapped, but not irrelevant

Under the previous rules, opening an AL in an apartment building required unanimous consent from the condominium. A single dissenting neighbour could block a registration. That requirement is gone.

Condominiums retain the right to oppose AL operations, but the threshold is now materially higher. Opposition requires a majority vote — more than 50 per cent of the building's share capital — and must be grounded in documented, repeated disturbances. A general objection to short-term rentals is not sufficient. For villa owners operating standalone properties, this change is largely academic; for apartment owners in complexes in Albufeira or Vilamoura, it is directly relevant.

Capacity, insurance, and the 60-day window

Maximum guest capacity has been reduced from 30 to 27. The ceiling of nine bedrooms remains unchanged. Convertible beds — fold-out sofas, pull-down bunks — are permitted but may not exceed 50 per cent of the property's fixed bed count. For most Algarve villas, this change is minor in practice.

Insurance has been elevated as an enforcement mechanism. Municipalities may now demand proof of valid AL insurance within three days at any point. Failure to produce it creates a risk of registration cancellation. Owners should ensure their documentation is current and immediately accessible — not filed in a drawer or held only by a managing agent.

The municipal opposition window has been extended from 10 days to 60 days, or 90 days in designated containment areas. The former 10-day window was effectively a rubber stamp; 60 days is a genuine review period that owners planning new registrations must factor into their timelines.

Municipal autonomy: the new variable

The clearest message from DL 76/2024 is that Portugal has moved from national prescription to local discretion. The Mais Habitação framework tried to impose uniform rules on every municipality; this decree law returns power to individual councils to manage their own housing and tourism pressures.

That means the regulatory landscape across the Algarve's eight coastal municipalities is no longer uniform — and it will diverge further as councils exercise their new powers. Albufeira, with the highest concentration of AL properties in the region, is most likely to act first. Lagos and Lagoa, popular with international buyers, bear watching closely.

Owners with properties in more than one municipality — not uncommon among investors in the Algarve — will need to track each council's position independently.

What to do now

DL 76/2024 is good news for most Algarve AL operators, but it is not a reason to disengage from compliance. The framework has shifted from one national rulebook to eight local ones — and those local rules are still being written. Confirm your registration is current, verify your insurance documentation is in order, and monitor your câmara's planning and housing notices for any containment zone proposals.

If you are considering a new registration or purchasing a property with an existing AL licence, take legal advice before exchanging contracts. The transferability restoration is real, but exceptions in future municipal containment zones could still affect it.

Stay current with Algarve property regulation changes on the APC news page, or join the APC waitlist to be among the first to access our compliance tracking dashboard when it launches.