Algarve is “one of the most affected areas” by the changes in LA foreseen in “Mais Habitação” (More Housing)

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Global final vote of the “Mais Habitação” program is today, in the Assembly of the Republic. Local Accommodation Association promises more fight

Local accommodation represents about 35% of tourist overnight stays in the Algarve, a region that “will be one of the most affected by the new legislative package that the Government wants to approve”, guarantees Eduardo Miranda, president of the Local Accommodation Association in Portugal (ALEP).

This Wednesday, July 19, five months after the approval of the first version, by the Council of Ministers, the “Mais Habitação” program, which provides for severe restrictions on Local Accommodation (AL), goes to the final global vote in the Assembly of the Republic.

On July 6, ALEP promoted, in Albufeira, a conference on the “Impact of “Mais Habitação” on Local Accommodation, Tourism and Economy of the Algarve”, which was attended by more than a hundred and a half participants, mostly owners of LA in the region.

In that session, Eduardo Miranda argued that the measures announced by the Government for AL and supposedly aimed at solving the problem of lack of housing in Portugal are a fallacy. “It is not with radical measures that structural problems are solved” of housing in the country, he said.

Citing a study that NOVA SBE did on the Local Accommodation sector, the president of ALEP stressed that, at national level, AL currently represents 40% of overnight stays, in addition to the fact that “tourists who used Local Accommodation in their visits to Portugal spent more than eight billion in the national economy, a figure that represents 3.8% of GDP”.

Hence, he stressed, “the measures will completely destroy Local Accommodation, a pillar of Tourism and the national Economy”.

The conclusion that was drawn at the end of a two-hour conference, with several guests, was that the Algarve’s economy is based on tourism, with local accommodation representing more than 60% of the region’s tourist accommodation capacity. Now, they defended, “the measures of” More Housing “can not only put at risk a good part of the local accommodation sector, but all related activities such as real estate, restaurants, commerce, tourist services and many others”.

Algarve is "one of the most affected areas" by the changes in LA foreseen in "Mais Habitação" (More Housing)

On the importance of LA in the Algarve, Cláudia Ribeiro de Almeida, professor at the School of Management, Hospitality and Tourism of the University of Algarve and CinTURS researcher, presented the latest data on Tourist Accommodation in general and LA in particular.

According to the researcher, the Algarve concentrates 39.2% of the country’s LA, followed by the Lisbon Metropolitan Area (27%) and the North (18.5%).

In the Algarve, of the 269,695 tourist beds, almost 60% (160,156 beds) are LA. The rest are in tourist developments and hotels.

The top5 of the municipalities with more registered Local Accommodation starts with Albufeira, with 9967 (corresponding to 34,314 beds), followed by Loulé (6871 AL and 29,063 beds), Portimão (6115, 17,737), Lagos (5827 and 21,951) and Lagoa (3747 and 14,524).

Also according to the data revealed by Cláudia Almeida, by parishes, the one that stands out is Albufeira and Olhos de Água, with 8415 AL registered there. The second parish has more or less half of these: it is the Parish of São Gonçalo, in Lagos, with 4110 AL.

Next, at a great distance, are the União de Freguesias de Lagoa e Carvoeiro (2201), Luz de Lagos (1509) and Guia (1305).

Aspect of the Albufeira municipal auditorium during the LA conference
Aspect of the Albufeira municipal auditorium during the LA conference

In the Algarve, 66.37% of the LA are owned by natural persons, while only 33.63 are owned by companies. In other words, there is little weight of large owners in the Algarve region.

In the AL here in the Algarve, 65.7% are apartments, 30.8% are villas, with the remainder divided into rooms (0.9%), hostels (0.3%) and guest houses or guesthouses (2.3%).

Local Accommodation is also responsible for the vast majority of tourist beds in the 16 Algarve municipalities, with the exception of Monchique (where there are few LA and the weight of hotels is greater) and Vila Real de Santo António, where traditional hotels in Monte Gordo weigh heavily.

2018 was the year in which more LAs opened in the Algarve (5992), while in 2023, despite all the clouds that overshadow the future of the sector, 4848 have already opened.

The data revealed and commented by the CinTURS researcher give a good idea of the importance of the Local Accommodation sector in the Algarve region. “A destination cannot be just hotels, it cannot be just tourist apartments, it has to have another type of accommodation”, stressed the professor at the University of Algarve.

Algarve is "one of the most affected areas" by the changes in LA foreseen in "Mais Habitação" (More Housing)

Cláudia Ribeiro de Almeida ended her presentation by talking about the impact that LA has on all sectors of the economy, from services, to transportation, to restaurants and nightlife, to small businesses, to amusement parks and museums, to the collection of taxes and fees, not to mention urban rehabilitation.

“When I went to live in Faro 22 years ago, there were a lot of abandoned houses in that area, as well as in Olhão. Today, these cities have a brutal dynamic and much is due to Local Accommodation”, he added.

In fact, construction and real estate itself will be affected, as the draconian measures recommended in the “Mais Habitação” package move forward. As Eduardo Miranda recalled, “the purchase of vacation properties in the Algarve has always had an argument in exploitation for tourists”.

José Carlos Rolo, Mayor of Albufeira, present at the conference promoted by ALEP, stressed that LA “is not only interesting for itself, but also for all the businesses that revolve around it”.

The mayor, who regretted that the Chambers were not heard by the Government for the elaboration of the “More Housing” package, added that “before there was AL, the beds were already available, they were the parallel beds, but they had no control, what there was was tax evasion”.

As for the argument that the measures imposed on LA are to ensure more rental homes on the market, Rolo was peremptory: “no one is going to pass LA homes for housing”.

Or, as businessman Reinaldo Teixeira, CEO of the Garvetur business group, also a guest at the conference, pointed out, if it does go through, “it will be at such high prices that the average citizen will not be able to rent them”.

José Carlos Rolo admits that Local Accommodation has to have “some regulation”, to avoid certain problems, such as noise. But he defended that “it is not by ending AL that the housing problem will be solved, that is wanting to hide the problem”.

Algarve is "one of the most affected areas" by the changes in LA foreseen in "Mais Habitação" (More Housing)
Businessman Reinaldo Teixeira, who took part in defining the first rules of the AL, recalled that “I have been doing this for 40 years and I have burned a lot of eyelashes in this matter”.

“If this goes ahead – and I’m seeing this hard to turn back… – it’s messing up what was tidy. If this goes ahead, you’re going to create informality, as well as fear and distrust on the part of potential investors. This affects investor confidence because it’s changing the rules in the middle of the game. Those who are out there, thinking of investing, hear this and back off. What image is being given of Portugal?”, asked Reinaldo Teixeira.

“Investors will think: if I can’t monetize, I won’t buy. And if they don’t buy, there is no purchase of land, no IMT, no work for architects and engineers, no work for construction companies,” he said. “All this will have an impact on GDP that is incalculable!”, he warned.

“This does not solve the housing problem, on the contrary, it harms it!” he said. Those who have invested in LA, such as Garvetur, “are fully committed to being part of the housing solution. But not in this way. This is achieved by stimulating the economy, getting people to invest, not the other way around”.

For today, July 19, the local accommodation sector has prepared a “national mobilization”, in front of the Assembly of the Republic, to protest against the very likely approval of the “Mais Habitação” program.

But Eduardo Miranda, president of ALEP, before the more than one hundred and fifty people who filled the municipal auditorium of Albufeira, promised that the sector’s struggle will not stop here, nor end with the approval of the package.

He announced that the association is “working on a legal opinion on this law”, even foreseeing a possible appeal to the Constitutional Court and even to the European Commission, “because this law goes against the rules of free competition”.

With the new measures, he warns, there will be a sharp setback for the economy and for the regulation of tourist accommodation beds across the country.

“We will still see Tia Maria and Tio Manel again, who had the chambres, rooms, zimmers”, ironized Cláudia Ribeiro de Almeida.

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