Renting in Europe in autumn 2026: Portugal lifts limits on landlords, Spain freezes rents

In brief

• Portugal is preparing a reform of its urban lease law (NRAU). The government approved the bill on 9 July 2026, and parliament passed it at first reading on 30 September. The text is now being reworked in committee; there has been no final vote.
• The key point for landlords: the cap on the starting rent for flats that were already let is abolished. Up to three months of rent can be taken in advance, the deposit cap goes, and a lease can be terminated for arrears of two months instead of three.
• This is an enabling law: parliament authorises the government to rewrite the rules. Once it is in force, the government has 180 days to issue the decree-law itself. In my estimate the new rules will not apply before 2027.
• Average rent in Lisbon according to official statistics is EUR 17.79 per square metre per month on new leases in Q2 2026. I did not find the figure of "EUR 253" in official data and do not use it.
• A Lisbon flat at median prices gives a gross yield of about 4% and about 3% after vacancy and costs. Buying a home in Portugal has not qualified for a residence permit since October 2023.

What Portugal is changing in its rental law

The New Urban Lease Regime (NRAU) has applied since 2006, but in twenty years it has been amended so many times that landlords stopped trusting it. The government says so plainly in the explanatory memorandum to the bill: according to the 2021 census, about 375,000 homes stand empty and are neither sold nor let, almost 250,000 of them in good condition. The aim of the reform is to bring these homes back to the rental market and so bring rents down.

Bill 103/XVII rests on four pillars: more freedom of contract, more reliable enforcement, faster eviction, and the state rather than the landlord bearing the cost of protecting vulnerable families. To that end the government also approved a housing emergency fund. It will pay families evicted because of poverty or domestic violence so they can be rehoused quickly.

Below is what matters to an investor. I have put the provisions from the text of the bill into a table.

The most important row is the first. The 2023 "More Housing" package (Law 56/2023, Article 34) capped the starting rent of a new lease: if the flat had been let in the previous five years, the new tenant pays not much more than the old one. A landlord who bought a flat with a tenant on an old rent could not get to market rent even after the tenant changed. The bill expressly proposes repealing this article and all limits on rent reviews in Law 56/2023.

The second important group is eviction. Today a landlord can terminate a lease for arrears of three months. The bill lowers the threshold to two months and adds a new ground: a delay of more than eight days more than three times in 12 months or more than four times in 18 months. The special eviction procedure through the Lease Office is simplified, and an appeal against a court ruling will no longer automatically halt eviction.

The third concerns fixed-term leases. The bill removes the minimum periods of automatic renewal and the limits on a landlord refusing the first renewal. For short tourist leases the cap on their number per year is lifted, but in total they cannot exceed 90 days a year. Nightly letting (alojamento local) is governed by a separate law, and this bill does not change it.

What this means for you. If you are buying a flat in Portugal with a tenant or for long-term letting, the reform works in your favour: it is easier to reach market rent, payment is better protected and the route in case of non-payment is shorter. But for now all of this is a draft, not law.

Where the bill stands and when it will apply

I always separate an approved draft from a rule in force. As at 16 October 2026 the bill has passed only its first reading. According to parliament, on 30 September the governing PSD, IL and CDS-PP voted in favour, Chega abstained and the other parties voted against. The same day the text was sent back to the committee on infrastructure, mobility and housing for article-by-article review.

Chega's abstention was conditional. According to the parties' public statements, the governing party agreed in committee to limit the advance payments and deposits that the bill allows without a cap and to strengthen protection for elderly tenants on pre-1990 leases. So the figures in the table above may still change, especially on deposits.

There is a second feature. This is a legislative authorisation law: parliament does not rewrite the NRAU itself but authorises the government to do so by decree-law. The authorisation runs for 180 days. So after the final vote and the president's signature another document must follow, which the president also signs. The president may veto or send the text to the Constitutional Court. Given these steps I do not expect the new rules to apply before 2027.

What this means for you. A deal that only pays off under the new rules is premature today. Calculate the yield under the current law and treat the reform as a possible upside.

What rent costs in Lisbon according to official data

For this piece I was given the figure "average rent in Lisbon about EUR 253". I checked the releases of Statistics Portugal and found no indicator with that value, whether in euros per square metre or in euros per week or month. Since the figure is not officially confirmed, I do not use it. It is a good example of why any "average rent" needs checking: people confuse the rate per metre with the rent per flat, listings with deals, the city with the metropolitan area.

The official statistics work like this. The institute calculates the median rent per square metre per month on new leases that landlords register with the tax authority. These are real signed leases, not asking prices. According to the release of 29 September 2026, in Q2 35,407 new leases were registered in Portugal, with a median of EUR 10.17 per metre, 10.2% higher than a year earlier. In the city of Lisbon it is EUR 17.79 per metre, the highest rate among the 24 municipalities with more than 100,000 people, but annual growth there is below average at 5.1%. In the Greater Lisbon area the median is EUR 15.24.

The institute calculates purchase prices the same way, from deals. According to the release of 17 July 2026, in Q1 the median in the city of Lisbon was EUR 5,292 per square metre, the most expensive municipality in the country. Next come Cascais (EUR 5,000) and Oeiras (EUR 4,511). Nationally prices rose 19.8% year on year, almost twice as fast as rents.

Hence the main conclusion for an investor: in Lisbon prices are rising faster than rents, and yields are being squeezed. More on districts and prices is in the review of Lisbon property, and on life in the city in the piece about living in Lisbon.

What a Lisbon flat earns: the calculation

I calculated a 60 square metre flat using the institute's two medians. It is a rough model: the price is for Q1, the rent for Q2, and a specific flat can differ from the median either way. Costs of 15% of rent are my assumption for management, building fees, minor repairs, insurance and the annual property tax.

In total that is about 4% gross yield and about 3% before tax on rental income. Purchase costs (property transfer tax, stamp duty, notary) are not included and reduce the yield further. They are broken down in the article on property taxes in Portugal.

How does the reform change this calculation? Directly, hardly at all: the median already reflects market rents on new leases. The reform matters for another scenario, buying a flat with a tenant on an old rent. Today when the tenant changes the landlord cannot raise the rent to market; after the reform he can. There is also less risk of prolonged non-payment: two months instead of three and faster eviction. A comparison of Lisbon with other cities is in the review of rental yields in Portugal.

What this means for you. Lisbon is a capital-preservation market with moderate rents, not a high-yield market. If you need 6% or more, look outside the centre of the capital.

Spain and Greece: the same autumn, different decisions

Spain went the other way. Since 8 October 2026 an emergency decree has applied: if the rent is above the state rental index for the area, it is frozen at the annual review; if below, growth is capped at 2%. Tenants can ask for an extension on the same terms. A detailed breakdown with the decree numbers is in the article on the rent cap in Spain. For an investor this means that income from a Spanish flat with a tenant is effectively frozen for the next few years.

Greece regulates not the rent but the type of letting. Since 2024 golden visa properties may not be let by the night; the penalty is a EUR 50,000 fine and revocation of the permit. On 15 October 2026 the migration minister promised to revoke permits also for getting around this ban through a sublet. What was said and how to check your deal is in the article on Greek golden visa revocation, and the real yield on long-term letting in the piece on rental yields in Greece.

So there are three different policies. Spain protects the tenant at the expense of the landlord's income. Greece allows only long-term letting for programme properties. Portugal gives landlords back freedom of contract so that empty homes return to the market. For a buyer these are three different sets of risks, and the same "buy to let" model cannot be applied across these countries.

What this means for buying to let

First, look not at the news but at the law in force on the date of the deal. In Portugal the reform is still a draft; in Spain the decree applies, but the standing committee of parliament must confirm it; in Greece the minister's statement has not yet become a rule. Any of these documents can change within a month.

Second, in Portugal the reform makes flats with tenants on old rents more attractive. Today such properties sell at a discount precisely because the rent cannot be raised. If the law is passed in its current form, the discount should narrow. But buying such a property on the strength of the reform is a bet on politics, not on the market. How to check a property before buying is described in the piece on property checks in Portugal.

Third, in Spain new purchases for long-term letting earn less than a year ago because annual rent growth is capped. In Greece yields hold up, but only with a long lease of a year or more to a tenant. The nightly model for golden visa properties is closed by law.

Fourth, calculate the net yield after tax in the country of the property and in your country of residence. The general purchase process in Portugal is described in the article on buying property in Portugal, and investment strategies in the piece on investing in Portuguese property.

What this means for you. For long-term letting in 2026-2027 Portugal is becoming friendlier to landlords, Spain stricter, and Greece stable with an honest long lease. That is not a reason to buy in Portugal specifically, but it is a reason to recalculate Spain.

What this means for buying for a residence permit

Here it is important not to mix things up. In Portugal the golden visa for buying a home was abolished in October 2023 by the same "More Housing" package. The fund and business routes remain, and the queue for decisions is measured in years; see the article on the Portugal golden visa backlog. What exactly was abolished is covered in the review of Portugal golden visa changes.

A flat bought in Portugal can still help with a permit, but differently. For the D7 passive income visa you need to show accommodation in the country, and your own flat meets that requirement. The purchase itself is not a ground for a permit. Terms and amounts are on the page Portugal residence for passive income and in the breakdown of the D7 visa.

In Spain the golden visa has been closed since 3 April 2025; details are in the article on the end of the Spanish golden visa. Of the three countries, buying a home for a permit works only in Greece, and there the reform is moving towards strict control: the contract price must be real and the letting long-term. The overall European picture is in the review of EU golden visas in autumn 2026.

What this means for you. If your goal is a residence permit, the Portuguese rental reform hardly affects you. If your goal is a permit plus rental income, look at Greece with long-term letting or the Portuguese D7 with your own flat.

Mistakes I see in calculations

• Taking "average rent" from listings or an unclear source. The official median from leases is usually lower than asking prices.
• Confusing the rate per square metre with the rent per flat. EUR 17.79 is per metre per month, not per home.
• Treating the Portuguese reform as already passed. So far it is a first reading and a 180-day legislative authorisation.
• Building nightly letting into a Greek golden visa property. It is banned, with a EUR 50,000 fine and revocation of the permit.
• Expecting rent increases on a Spanish lease. Until the end of 2027 reviews are capped by the index and 2%.
• Buying a home in Portugal for the golden visa. That route has been closed since 2023.

My conclusion

Autumn 2026 showed that "the European rental market" is several separate markets with opposite policies. Portugal is betting on landlord freedom and fast courts, Spain on freezing rents, Greece on controlling programme properties. For an investor this means the same flat for the same money brings a different income and a different risk depending on the country.

For Lisbon my calculation is simple: about 4% gross yield and about 3% after vacancy and costs, with prices rising faster than rents. The reform may add a lower risk of non-payment and freedom to reset the rent when the tenant changes, but only after the final vote and the decree. Until then I calculate deals under the current law and ask clients to do the same.

How this piece was prepared

This piece is based on the text of bill 103/XVII, filed by the Portuguese government with the Assembly of the Republic on 12 August 2026, the bill's record on the parliament website with the results of the vote of 30 September 2026, the communique of the Portuguese Council of Ministers of 9 July 2026, and the releases of Statistics Portugal of 17 July and 29 September 2026. For Spain and Greece we used our own analyses, linked in the text. We did not find the figure of "EUR 253" as average rent in Lisbon in official statistics and do not use it. The yield calculation is illustrative. This is not legal or tax advice on a specific transaction. The article will be updated if the bill changes.