When I look at the Portuguese real estate market, I see a sector full of potential but also one weighed down by unnecessary obstacles. On one side, there are clear opportunities: flexible usage concepts, a growing demand for innovative spaces, and the increasing role of sustainability. On the other hand, we are confronted with excessive regulation, inefficient tax policies, and a lack of professionalism that damages our reputation. If we want this market to thrive, both government and industry need to change course.

One of the biggest challenges I face in my work is the sheer volume of bureaucratic requirements for construction and property operations. I am not speaking about rent controls, but rather about the endless municipal and state level rules that make projects slower, more expensive, and often unworkable. Too often, regulations are introduced without considering their practical consequences. The result is higher costs that landlords pass on to tenants. Adding to this burden is the 28 percent tax on rental income, which feels like a direct penalty on ownership and inevitably pushes rents upward.

These conditions explain why so many ground-floor units in our cities remain vacant. Owners, developers, and potential tenants find themselves unable to implement new ideas within the restrictive framework, leaving behind spaces that are unattractive and unproductive. This is a loss not just for investors but for our communities as well.

At the same time, I am convinced that opportunities are greater than ever. The variety of commercial uses continues to expand. Boarding houses, serviced apartments, and short-term rental concepts for business travelers are all in demand. Sports and leisure facilities such as padel courts, climbing gyms, indoor cycling studios, or escape rooms are becoming increasingly popular. Properties that are designed to be flexible, and owners who are willing to embrace new models are the ones who stand to gain the most from this trend. The pandemic has only accelerated the appetite for innovative, multifunctional spaces.

Sustainability is another theme I believe we must take seriously. Investments in renewable energy and energy efficiency are not only the right choice for the climate but also a guarantee of long-term competitiveness. Optimized buildings lower operating costs for tenants and increase the value of assets for owners. This is where the future lies, and those who hesitate risk falling behind.

Still, I cannot ignore a topic that troubles me deeply! The lack of professionalism in parts of our industry. Quality should always be the foundation of real estate work. For me, professionalism means more than technical know-how. It means consistent and well prepared marketing materials, high-quality photos, accurate documentation, clear communication, and above all, strong ethical principles. Unfortunately, these standards are too often missing in Portugal. Where construction is overregulated, professional conduct is underregulated. This imbalance undermines trust, and it is one of the reasons our profession sometimes suffers from a poor reputation. Here, I would welcome stricter standards and oversight. Or “How can it be that a broker holds an AMI license to sell property in Portugal, yet lacks the language skills to even read the very laws and regulations that govern the market?”

I also believe we need to promote home ownership as a national priority. Owning property remains the most reliable form of retirement security. We must simplify housing development and rethink the tax system to provide meaningful incentives, particularly for those who make their properties available for rent. Without these changes, young people will find it increasingly difficult to step onto the property ladder.

Finally, I must stress that responsibility does not lie with the government alone. As professionals, we must look in the mirror. Many of the restrictive measures we now face are the direct result of unethical practices by a minority, whether large investors or small landlords. Every time we make headlines for evictions under false pretenses or other questionable behavior, we undermine our own industry. If we want less state intervention, we need to hold ourselves to higher standards first.

The Portuguese real estate market truly has all the ingredients for success: location, demand, creativity, and international interest. But to unlock this potential, we need smarter governance, fairer taxation, and stronger professional ethics. I am convinced that if we take these steps, Portugal can become a benchmark for real estate development in Europe and a market that delivers value not only for owners and tenants but for society.

Author

Paulo Lopes is a multi-talent Portuguese citizen who made his Master of Economics in Switzerland and studied law at Lusófona in Lisbon - CEO of Casaiberia in Lisbon and Algarve.

Paulo Lopes