July 8, 2019 - Comments Off on The relationship between units being used for short-term leases and the Condominium of the building

The relationship between units being used for short-term leases and the Condominium of the building

In an attempt to clarify and further develop the legal regime on short-term leases, new legislation has been approved to amend and substantiate certain aspects, with one of the most important being the relationship between the Condominium of the building and the independent units being used for short-term leases, due to the tensions that normally arise from these cases between those using the units for short-term leases and the remaining owners of units in the same building.

As such, it has been clarified that the Condominium’s General Meeting cannot decide to forbid the use of a unit for short-term leases. The only exception to this rule are units being operated as hostels in buildings for habitation, where it is necessary to first seek a decision from the Condominium’s General Meeting approving that use. For all other cases, the only thing the Condominium can do is have owners who represent at least more than the majority of the percentage of the building decide that a unit should not be allowed to do short-term leases, so that this is conveyed to the President of the City Hall, who will decide whether or not the short-term leases should be prohibited. However, in order to decide this, the Condominium needs to allege specific facts that took place for a continued period of time and which disrupted the rest and well-being of the owners of units at the building and/or affected the normal use of the same.

The Condominium, based on the fact that some units for short-term leases may use the common parts of the building more than the owners ot the remaining units, may decide that the owners of the units being used for short-term leases must pay an amount towards the use of the common services of the building up to 30% more than the yearly condominium fees that those owners already have to pay. However, for short-term leasing units which were already in business at the time this new law came into force, the Condominium can only approve the above mentioned 30% starting from November 2020.

Lisbon, 4th July 2019

By Rodrigo Noronha Mourão, Associate at EDGE International Lawyers – Litigation Department

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