Portugal is introducing restrictions on short-term rentals to address the housing crisis.

The government may revoke the licenses of a third of the approximately 120,000 registered short-term rental properties due to a lack of necessary evidence. Portugal is trying to tackle the housing crisis by imposing restrictions on short-term stays.

More than a third of all short-term rental properties could be removed from the real estate market in Portugal as a result of government efforts to address the housing crisis. The outgoing socialist government has blamed short-term rentals for contributing to the housing shortage in cities like Lisbon, where housing prices are now higher than inMilan, Madrid, and Berlin, according to Bloomberg City Tracker.

Owners of short-term rental properties in Portugal were recently given two months to provide proof of the use of their properties. Those who failed to do so were warned by the authorities that their licenses would be revoked.

The deadline for providing this information, including tax documents, expired on Wednesday (the 13th). It was extended by almost a week after the website had issues and froze several times.

Out of 120,719 registered short-term rental properties in the system, 45,747 license holders did not provide valid proof of their rental activity.

“This means that more than a third of short-term rentals in Portugal could be canceled,” said Eduardo Miranda, president of the Short-Term Rental Association in Portugal. He added that some of these licenses are already inactive.

"The problem is that many of these short-term rental property owners may be unfairly excluded from the market due to how the process was conducted," said Miranda.

Among the owners whose licenses may be revoked are foreigners living abroad who cannot provide proof of their commercial activities, as access to the government website requires a valid Portuguese identification card, said Miranda. He also noted that this could affect elderly people who do not have the necessary documents to access the government platform.

“I just hope that the government and local authorities will take all these issues into account before making a decision on whether to revoke or maintain part of these licenses,” said Miranda.

At the beginning of this year, the Portuguese government implemented a series of measures aimed at alleviating the ongoing housing crisis. This included initiatives to expedite the building permit process, a ban on new short-term rental leases in cities, and the closure of the so-called golden visa program.