property rental licence

[Alison]

Our rental licence is 'in process' as part of a job lot being organised by our managing agent.

Yes, we have had our 2012 tax return audited - annoying as there was a minor quibble over the paperwork for one item which then allowed the authorities to require the tax return to be resubmitted, even though another undercharge meant that our overall tax liability was actually less than we had put in our return! The Tax 'fine' (for having to resubmit the return) cost £100 euros plus the Tax Angel fee for dealing with this (92 euros - pretty reasonable I thought).

[widge]

Our rental licence is 'in process' as part of a job lot being organised by our managing agent.

Thanks for sharing that Alison,sounds like your guy is "Getting his house in order" which is the responsible thing to do for himself, his owners & his rental customers.

The MD of our rental agency (over 100 villas in the Algarve) has offered to look at emphasising the fact that all their villas are licenced and meet all H&S regulations. This is a start & a reassuring move in the right direction. He also mentioned that they had received bookings this year from a number of new clients who had been victims of internet fraud. Clients had booked villas on the internet, spoken direct to the owner or agent, paid by cheque or bank transfer only to discover that the villa didn't exist or wasn't owned by those offering it. If you can't pay by credit card or paypal then you have no recourse - no holiday & money gone !

[snowbirds]

Interesting article from last week's Algarve Resident

"A new law which obliges real estate agencies to obtain an Energy Efficiency Certificate for all houses for sale or rent on their books will come into effect on December 1 and is causing a sense of uneasiness in the sector.

The certificate, called Sistema de Certificação Energética dos Edifícios, or SCE, which is valid for 10 years, will include the energy efficiency of the property on a scale of A+ to G, from the highest to the lowest, as well as a list of recommendations to rationalise and improve energy consumption.

An interpretation of the new law by Portuguese consumer watchdog DECO shows that “all immovable properties which are advertised for sale or rent must indicate their energy efficiency through this certificate”, and that this obligation applies to those responsible in the sale or rental process.

Before the passing of this law on August 20, properties only required this certificate at the time of signing the deed."

Therefore, real estate agencies not in possession of certificates for all properties up for sale or rent will now have to ensure owners obtain them before the December 1 deadline.

At estate agents Fine & Country in Carvoeiro, managing partner Zoie Hawker told the Algarve Resident that they expect the new regulation to cause major problems in the industry.

“As a newly-opened agency still in the process of building up our portfolio of properties, it will not cause too many headaches for us,” said Zoie Hawker.

“But other agents who have hundreds or, in some cases, thousands of properties on their websites have a mammoth task on their hands.”

Paul Greenhalgh from Yellow Homes real estate advisory business told the Algarve Resident that the new regulation will mean “some extra-work earlier in the process”.

“It won’t affect our job too much,” he said, stressing however that it needs to be made clearer to vendors what is inspected.

“One of our properties received a low mark (F) because we were not aware of the requirements. We need to know in a clearer way what is inspected and expected of the properties,” he added.

The price will be high for owners or agencies with properties on the market caught without the appropriate certificate, whose issuance costs around €250.

If properties are not equipped with the certificate, owners can be fined from €250 to €3,740, while estate agencies with properties listed without a certificate can be charged from €2,500 to €44,890.

[widge]

Yes, we have had our 2012 tax return audited - annoying as there was a minor quibble over the paperwork for one item which then allowed the authorities to require the tax return to be resubmitted, even though another undercharge meant that our overall tax liability was actually less than we had put in our return! The Tax 'fine' (for having to resubmit the return) cost £100 euros plus the Tax Angel fee for dealing with this (92 euros - pretty reasonable I thought).

We have also been informed by our managing agent that all properties under her management are being audited by the tax office. Sounds like there's a clampdown in operation. In addition to all receipts for expenses a copy of the rental agreement (which is with a UK based company) has also been requested.

I expect the Camara will be overwhelmed with licence applications in the next few weeks!

[shanagarry]

If the impact of this new regulation suggested in The Algarve Resident (as per Snowbirds post) is going to create another area of 'legislative evasion' (I can't think of a better description) how long will it be before the cost of compliance completely outweighs the benefits of property ownership? Throughout this topic we have seen the cost to obtain a rental licence varying upwards from €2,000 - now this latest one at €250 (that's before you have work done to ensure you are ready for inspection). It's not too difficult to see why many prefer to run the risk of non conformity.

With an ever shortening rental season - the tight squeeze on rental rates, the hassle of compliance and now the upward spiral of all the ancillary costs - is the return on your investment really what it was when you embarked on the dream of a place in the sun'. I suspect the answer will depend on your circumstances - but if you are dependent on rental income I suspect it is marginal.


We all know the Portuguese fiscal purse is empty - but surely there must be somebody in that area of government with a modicum of common sense - who sees the damage all of this petty legislation will have on inward investment. What's next - a sunshine levy - don't laugh

[widge]

I don't think that the energy certificate relates to holiday rentals. If you think about it the owner pays these costs whereas in commercial lets the occupier does.

The AL process got off to a bad start as the legislation was poorly drafted and the authorities were ill prepared. This has improved and it is now fairly straightforward. It provides holidaymakers with some protection from unsatisfactory rental properties & hopefully raises the bar vis a vis cleanliness, safety & suitability. If it knocks some inappropriate properties out of the rental market that's good, there's too much supply & too little demand.

Frankly it is unlikely to make a shred of difference to visitor numbers but the licensing process & tax audits might improve revenue to the authorities & local builders / maintenance companies.

[charliegill11]

I need an EPC doing on a property just outside Carvoeiro does anyone have a recommendation as I have a quotation of 295 euros which for a one bedroomed apartment is in my opinion excessive as it four times higher than you would pay in the UK.

[shanagarry]

I don't think that the energy certificate relates to holiday rentals

That says all that needs to be said - the absence of clarity - so everybody jumps to their own conclusion. Nobody knows - yet it's in the public domain.

The AL process got off to a bad start as the legislation was poorly drafted and the authorities were ill prepared

This is the breeding ground for non-compliance

This has improved and it is now fairly straightforward

Really

It provides holidaymakers with some protection from unsatisfactory rental properties

That's no bad thing - if it's really achieved that - has it?

Peter, I'm with you on this but I have my suspicions that this half-hearted attempt at 'fairness' only works one way - regretfully that's not the direction or shape that will benefit the general public.

Keep well my friend

[ANDY]

Check out the letter that came in our water bills this month, seems the camara are now helping the inspectors.

[Sheila]

According to an article in the latest AFPOP magazine its all change again on the AL front.

A license is no longer necessary and there is no initial fee!

However, you must still inform the Camara who will inspect the property within 300 days.

The AL board is also no longer required for houses and apartments.

Decreto-Lei no. 128/2014 came into force on 27 Nov 2014.

The bad news is you do have to register as self-employed as mentioned elsewhere on this forum.

[LICY]

We never received any letter with a water bill. Having said that until 3 weeks ago the villa manager was paying it on our behalf. We have already sorted that out but at no time was anything said in Lagoa Friday or 3 weeks ago when the bills were paid. We have sent some information to our lawyer having spoken to our accountant. Not sure anyone really knows if we still need to do anything more as we have a license. Fingers crossed if the deadline for something is 27 December we don't end up receiving a fine.
Regarding self employed comment above, maybe foolishly I think we must be with the accountant. Confused.

[snowbirds]

Our accountant visited the Lagoa Finance Department early in December, and he was told that they are not going to inspect any properties with an existing AL licence. However, Portimao Camara will be carrying out inspections. So it appears that it is up to the individual municipalities. We were also advised that submitting the Inicio de Actividade form is required to register you as a business (in order to comply with the new tax regime) and we have not heard anything to the contrary.

[LICY]

We are all sorted so pleased about this.

[LandscapeMan]

All very interesting. Just met with Sovereign and they are still saying a licence is needed so…
Does anyone know of a company or individual that offers the service of obtaining a licence for those of us without the time or inclination to do it themselves with an idea of approx costings for this?
Our manager isn't able to do this for us and Sovereign want a kings ransom…

[widge]

All very interesting. Just met with Sovereign and they are still saying a licence is needed so…
Does anyone know of a company or individual that offers the service of obtaining a licence for those of us without the time or inclination to do it themselves with an idea of approx costings for this?
Our manager isn't able to do this for us and Sovereign want a kings ransom…

You are presumably planning on renting your property? If not you don't need a licence. Your managing agent should be able to facilitate this as they have a vested interest in your property being legal. There is considerable work & expense involved in getting an AL licence most of which has been well documented on this forum; it has been a legal requirement for several years now!

I would recommend you appoint a managing agent who can offer practical assistance in obtaining a licence. I use a company called Borboleta in Ferragudo - they are excellent in all respects and you will find their contact details advertised on this forum I think.