Residential rentals in commercial properties: is it possible?

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The purpose of the contract must be “confirmed” by the license. We explain, on legal grounds.

The lease must include a clause stating the purpose of the lease. If the lease is silent on this point, the rented premises can be used for the purpose that is within the scope of its capabilities, as stated in the license . So, is it possible to rent a store for residential purposes? It depends. We explain, on legal grounds.

According to the legal regime in force, “only buildings or their fractions whose suitability for the purpose intended by the contract is attested by the license of use may be subject to urban lease “, and a lease for a purpose other than that licensed is null and void.

Nullity of contract and fines

Therefore, if a particular property is used for commercial purposes, it cannot be the subject of a contract for residential purposes, whether permanent housing, non-permanent housing or special transitional purposes.

Violation of this rule results in the nullity of the contract, which means that the tenancy relationship is non-existent and that the property is occupied improperly, which could have consequences in terms of civil liability.

Nullity, on the other hand, based on the violation of a mandatory legal rule, will result in a fine being imposed on the landlord and, in principle, gives the tenant the right to compensation, as well as the right to terminate the contract for reasons attributable to the landlord.

The amount of the fine payable by the landlord in the aforementioned circumstance, for a cause attributable to him, amounts to no less than one year’s rent.

Living in a commercial property: implications

The issue becomes even more important when we are faced with the need for a rental contract to substantiate and justify a particular state benefit. This is the case, for example, with the benefits granted under the program that creates the financial support instrument for renting by young people, known as Porta 65.

In fact, in addition to the various requirements that young people aged 18 or over and under 35 must meet, such as not owning or renting another building or housing unit for residential purposes or being related to the landlord in the direct or collateral line, applicants for the benefit must hold a rental contract registered on the Finance Portal or a promissory rental contract, the latter in accordance with the model approved by ordinance.

Having said that, it would obviously be out of the question to grant a benefit such as Porta 65 or any other, based on an invalid document and, as has been said, a rental contract concluded for a purpose other than that for which it is licensed, is a null contract, and therefore an invalid and ineffective contract.

If a young person – in the case of the Porta 65 applicant – is faced with a situation such as the one described (null and void contract), he or she must take steps to sign a valid contract which, in view of the above, will mean moving from the place where he or she lives (a space used for commerce) to a place that is legally suitable for residential purposes.

Converting stores into homes: the impact of the new simplex

In this regard and without prejudice to the above, it should be noted that the Decree-Law that approved the so-called “Simplex Urbanístico” (DL no. 10/2024, of 8.01) simplified the process of changing any autonomous fraction in horizontal property from a non-residential purpose to a residential purpose (the reverse does not apply in the same way).

In fact, the owner who currently intends to change the purpose of his fraction from commerce to housing no longer needs the authorization of the Condominium for this purpose, but can change it by unilateral act, and is only obliged to inform the Condominium Administrator of this change within 10 days of the change.

We are therefore seeing a realization of the urban simplification that the previous government implemented. However, the grounds for invalidity of a rental contract have remained, namely that which derives from the conclusion of a residential rental contract in relation to a property whose purpose is other than residential.

Hervé Hubert
Hervé Hubert
Hervé Hubert is a 55-year-old writer and journalist based in Porto, Portugal. Born in France, he brings a unique blend of French and Portuguese perspectives to his work. Education Hervé studied Journalism and Literature at the University of Lyon in France. After completing his studies, he gained valuable experience working with various French media outlets (Portugal France also). Career He worked for several years as a journalist in France before making the move to Portugal. In Porto, he joined the Portugal Pulse team as a staff writer. Skills Hervé specializes in storytelling, investigative journalism, and cultural commentary. He has a flair for capturing complex issues in a relatable way. Personal Life He currently resides in Porto and enjoys the city's rich culture, from Fado music to Francesinha cuisine. Hervé continues to maintain strong ties to his French heritage, often traveling back to France for family visits and cultural exploration. With his unique background and diverse skill set, Hervé Hubert adds a layered, multicultural lens to every story he covers.

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