How to Get Started if You Want to Open and Operate a BnB in Portugal

jvanklarenbosch
Sep 12
3 min read

Portugal has become one of Europe’s hottest destinations for travelers. From the sun-soaked Algarve to Lisbon’s vibrant streets and Porto’s riverside charm, the country attracts millions of visitors each year. If you’ve ever dreamed of running your own bed and breakfast (BnB) here, you’ll be happy to know it’s possible—but there are important steps to take before welcoming your first guests.

Whether you’re a retiree looking for a lifestyle business, a digital nomad considering property investment, or simply passionate about hospitality, here’s a clear guide to getting started with your own BnB in Portugal.

1. Understand the Market

Before investing in property or renovations, research the local tourism landscape. Some regions have year-round demand (Lisbon, Porto, Lagos, Madeira, Azores), while others are more seasonal (many Algarve towns). Look at:

Tourist demographics: Families, couples, backpackers, luxury travelers?
Competition: How many other BnBs and short-term rentals are nearby?
Seasonality: Will you have income only in summer, or steady demand year-round?

2. Choose the Right Property

Your property will define your BnB’s appeal. Consider:

Location: Walkable to beaches, historic centers, or public transport.
Size & Layout: Number of guest rooms vs. private living space.
Amenities: Outdoor space, pool, or unique features that stand out on booking platforms.
Condition: Renovations can be costly, so factor this into your budget.

Tip: Many BnBs in Portugal are converted townhouses, villas, or countryside quintas (farmhouses).

3. Legal Requirements: Alojamento Local (AL) License

To operate legally, you must register your property as Alojamento Local (AL), which covers short-term tourist rentals and BnBs. The process typically involves:

Submitting an application to the local Câmara Municipal (town hall).
Meeting safety requirements such as fire extinguishers, smoke alarms, and a complaints book.
Ensuring proper zoning (some cities, like Lisbon and Porto, restrict new AL licenses in certain areas).

Once approved, you’ll receive an AL number, which must appear in all listings (Airbnb, Booking.com, etc.).

4. Taxes and Accounting

Running a BnB is a business, so you’ll need to handle taxes properly:

IRS (Income Tax): Rental income must be declared.
IVA (VAT): Depending on your revenue, VAT registration may apply.
Social Security contributions: If it’s your main source of income.

Most operators hire an accountant (contabilista certificado) to stay compliant.

5. Setting Up Your BnB for Success

Beyond the paperwork, the guest experience is what drives success:

Design & Comfort: Invest in good beds, linens, and thoughtful décor.
Breakfast & Hospitality: Some BnBs serve homemade breakfasts with local products—an easy way to stand out.
Digital Presence: List on Airbnb, Booking.com, and niche sites. Build a simple website for direct bookings.
Reviews Matter: Early reviews can make or break you—focus on outstanding hospitality in your first year.

6. Running Day-to-Day Operations

Decide how hands-on you want to be:

Owner-operated: You live on-site and handle everything (cleaning, check-ins, breakfast).
Managed BnB: Hire staff or a management company to handle bookings and operations.
Hybrid model: You handle the guest experience but outsource cleaning or laundry.

7. Cultural Touches Make the Difference

Travelers come to Portugal for its culture. Small touches like offering local wines, pastel de nata for breakfast, or insider tips about hidden beaches can make your BnB unforgettable.

Final Thoughts

Opening a BnB in Portugal is both a lifestyle choice and a business opportunity. With the right planning, compliance, and dedication to hospitality, you can create a rewarding venture that welcomes guests from around the world while allowing you to enjoy everything Portugal has to offer.

If you’re serious about getting started, begin with market research and a clear business plan—then take the legal steps to register your property. From there, it’s all about crafting an experience that keeps guests coming back.