With a list of all homes actively available for short term rental combined with the end of incentives for the granting of a golden visa Portugal’s government is struggling to find a way to deal with high housing costs, which have pushed a large part of the domestic population out of the market.
Among other things, Lisbon has launched actions to fully register all houses available for short-term rental on a special platform – like AirBnb. All this is happening while prices have skyrocketed in previous years through AirBnb and the Golden Visa program there and as a result ways are being sought to reduce prices.
Airbnb: Will pay more than half a billion euros to the Italian tax authorities
As part of measures to bring more properties to the market, the Portuguese government has given owners of short-term rental properties the freedom to list them on a special platform.
They also had to prove – with payment and tax information – that they were still being used. Otherwise, they were threatened with having their short-term rental license revoked.
More expensive prices in Lisbon
Figures now published by Bloomberg show that with the normal deadline, which passed last week, the government was forced to grant several days of extension because, among other things, the special platform for such declarations was overloaded.
Even so, more than 45,000 of these license holders failed to provide valid evidence that these leases were active – a total of 120,000 homes that were in the short-term rental scheme and had a special operating permit. And this despite the fact that those who rent their housing for less than 120 days a year were exempted from the process.
Now representatives of short-term rental owners in Portugal are protesting and asking for new measures before they start revoking the licenses in question, the same sources say.
Data from Bloomberg’s Bloomberg City Tracker, a new focus on the topic, shows that home prices in Lisbon are now higher than in traditionally more expensive cities such as Milan, Madrid and Berlin.
The golden visa factor
Another reason house prices have skyrocketed in Portugal has been the country’s Golden Visa program, which is now being changed to avoid the worst.
Since its inception in 2008, the program has faced a lot of opposition from local residents after being accused of contributing to a very serious housing crisis at prices unaffordable for most Portuguese. Until October, when real estate investments under the Golden Visa program were abolished, privileges were granted to anyone who invested over 280,000 euros in the country’s real estate market. According to Bloomberg, the number of foreign residents has increased by 40% in the last decade, according to the country’s statistics office.
The golden visa in Portugal became particularly popular because it offered foreigners more relaxed conditions than other countries. For example, all the privileges of the Portuguese Golden Visa are extended to the immediate family of the holder – parents, spouse and children. By November, golden visas had brought the country more than $7.3 billion and saved Portugal from recession, according to Foreign Policy.
The price increases from this program were compounded by increases due to high demand for short-term rental properties from tourists and other interested parties, resulting in an explosive cocktail of price increases.