What is the new Land Law proposal?

The Government had hopes of addressing the country’s housing crisis, which led them to publish a decree on 30 December 2024, revising the Legal Framework for Territorial Management Instruments (known as the Land Law). The decree determines that construction is only allowed on urban land but it introduces more relaxed measures for “exceptional” cases, where rural land can be reclassified as urban land, as seen with the example of protected agricultural zones. Portugal Decoded cites that “The decree specifies that construction on reclassified land must serve the needs of low- and middle-income families, with a price cap set at 125% of the municipality’s median price per square meter or 225% of the national median.”

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Also adding that, “municipalities are now given sole authority to approve reclassifications, removing the need for involvement from other organisations like the Regional Coordination and Development Commissions or the Portuguese Environment Agency.”

Parliaments involvement

The President expressed concerns regarding the Land Law sharing that it could distort land use regulations, despite this he did approve the decree and it was scheduled to take effect on 30 January 2025. However, the left-wing Bloco de Esquerda, Livre, PAN and the PCP have forced a Parliamentary debate on the decree to take place today (24 January). To confirm the decree in Parliament, the Government will need support from its two potential allies: the PS and Chega.

PORTUGAL DECODED asserts that “PS has stated its willingness to support a revision of the land law but only under stricter conditions. They demand that house prices remain below the national median, rather than 25% above it as currently proposed and that urbanised areas remain contiguous to avoid scattered development. It seems likely that the decree will fail in Parliament today. If so, the Government may begin negotiations with the PS to craft a new version of the land law that, in one way or another, will relax building restrictions.”

Land Law criticisms

According to PORTUGAL DECODED, Critics argue that the decree’s price cap of up to €3,737/m² is far above Portugal’s national median of €1,661/m², which could potentially drive prices up rather than down. They also highlight that in cities like Lisbon and Porto, where the housing crisis is most severe, there is little to no rural land left to reclassify, rendering the measure ineffective in those areas.

Environmental concerns include risks to biodiversity, landscapes and agricultural land, as well as insufficient safeguards for flood zones or erosion-prone areas. Finally, some opponents question the urgency of the matter, noting it may be too late to access EU funds and argue the housing crisis stems from underutilised urban land.

Those in favour of the Land Law

The Deputy Minister for Territorial Cohesion, Manuel Castro Almeida, defended the decree this week, calling the measure “absolutely anti-speculative” and arguing that it will help “lower house prices”, writes PORTUGAL DECODED.

Additionally, he argued that limited urban land has fuelled speculation and that increasing urban areas will enable “sustainable housing policies aligned with the needs of the population.” Responding to concerns about rural land development, Almeida insisted that expansions would align with existing urban areas and dismissed fears of new urban centers forming in rural regions. On potential corruption risks, he emphasised that the municipal decisions will be “transparent and open to full scrutiny” and debate within municipal assemblies.

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Author

Following undertaking her university degree in English with American Literature in the UK, Cristina da Costa Brookes moved back to Portugal to pursue a career in Journalism, where she has worked at The Portugal News for 3 years. Cristina’s passion lies with Arts & Culture as well as sharing all important community-related news.

Cristina da Costa Brookes