Rui Ribeiro Lima and Mónica Pimenta explain the new legal challenges in real estate with the rise of hybrid models

The Portuguese real estate sector is undergoing a significant transformation driven by new ways of living, working, and traveling that challenge existing legislation. Rui Ribeiro Lima and Mónica Pimenta, from Morais Leitão, explain the main legal challenges and opportunities arising from the growth of hybrid models such as co-living and mid-term rentals.

Rui Ribeiro Lima and Mónica Pimenta authored the article "New Ways of Living, Working and Traveling: Trends and Legal Challenges in Real Estate," published in Vida Imobiliária magazine, which analyses the profound transformations in the Portuguese real estate sector driven by new dynamics of housing, remote work, and mobility.

In the article, they highlight that the boundary between tourist accommodation and traditional housing is becoming increasingly blurred due to the growth of hybrid models such as serviced apartments, branded residences, co-living, and mid-term rentals. These trends respond to global dynamics, including the rise of digital nomads and remote work, favouring flexible experiences over long-term stays.

However, the lawyers warn of the legal challenges this transformation entails. Portuguese legislation remains focused on distinct regimes: the New Urban Lease Regime for long-term housing, Decree-Law No. 39/2008 for tourist developments, and Decree-Law No. 128/2014 for short-term local accommodation, which has faced increasing restrictions to ensure balance in the most affected urban areas.

For example, co-living is not explicitly covered by Portuguese law, creating uncertainty about its classification between residential and tourist use. Similarly, mid-term rental contracts oscillate between traditional leasing and short-term local accommodation, leading authorities to reinforce oversight to prevent abuses.

The authors conclude that Portugal is at the forefront of this social and economic transformation but emphasise the urgent need for legislative clarification and adaptation to ensure a fair, clear, and flexible legal framework suited to new ways of living and using space.

Read the full article in the attachment below.