The recent Land Law changes in Portugal focus on promoting public and affordable housing by allowing easier reclassification of rustic land into urban land for residential construction.
This shift aims to address the need for more housing, particularly for middle-class families, while also ensuring environmental protection and social equity.

The New Land Law in Portugal no 53-A/2025, published in April 2025, amends the controversial Decree-Law 117/2024 by parliamentary review and introduces significant changes to the Legal Regime of Territorial Management Instruments (RJIGT), especially with regard to the reclassification of rustic land/soils into urban ones for habitation purposes. Reclassification is now subject to stricter rules, with emphasis on the need to demonstrate public or strategic interest in conversion and protection of agricultural and forest land, with restrictions on reclassification for housing in certain areas of the National Ecological Reserve (REN).

New Land Law in Portugal: What Changes and What Are the Implications?

The recent approval of the new Land Law in Portugal, introduced several changes that directly impact the real estate market and urban planning. The main goal is to increase the availability of affordable housing, but there are also challenges, particularly regarding bureaucracy and the implementation of the new rules. Let's understand what changes with this new legislation.

Reclassification of Rustic Land: The new law simplifies the process of reclassifying rustic land into urban land, enabling construction of new buildings in previously non-urban areas. This is particularly focused on areas with potential for affordable housing, according to Idealista. 

Replacing the Terms: The term "moderate value housing" was replaced by "affordable rental" or "cost-controlled housing", 

Affordable Housing Priority: A significant portion of new constructions must be dedicated to public or affordable housing, with a maximum price cap to ensure affordability. 

Percentage of construction area: The new regime establishes that at least 70% of the total area of construction above ground must be allocated to public housing, affordable rental or cost-controlled housing, also ensuring the existence or provision of adequate general and local infrastructure.

Environmental Protections: While allowing for more construction, the law maintains protections for areas with high agricultural or environmental value.

Revocation of Previous Possibilities: The possibility to build housing for agricultural workers outside existing urban areas has been revoked.

Duration and Evaluation:

The decree-law takes effect from 31 December 2024 and will be in force for four years. The extension of this regime will depend on the presentation and discussion, in the Assembly of the Republic, of a report evaluating its application, justifying the decision to extend it.

These changes aim to increase the supply of affordable housing, promoting a more efficient use of available land.

For more details, see the full article in Idealista and The Portugal News 

Importan Note: This article is for informational purposes and does not replace consulting the official legislation