Lisbon's Mid-Term Rental Market: A Goldmine for Foreign Investors
A rising trend in medium-term rentals is creating a lucrative new frontier for foreign investors in Portugal's real estate market. Focused on Greater Lisbon and Setúbal, this strategy targets the growing demographic of remote workers and expats who need flexible, high-quality housing, offering a stable alternative to the volatile short-term tourist market.
Ankit Ruia, CEO of investment firm Sempre Fixe, has built a portfolio of over 250 renovated units on this model. He notes that regulatory shifts away from short-term lets (Alojamento Local) are pushing property owners towards the stability of longer-term contracts, making this the ideal moment for investors to enter the space.
What Foreign Investors Need to KnowThe core opportunity lies in bridging the market's quality gap. Much of Lisbon's housing stock is aged and requires significant upgrades. "We believe that the 'problems' inherent in licensing and construction costs mean that there is likely to be very little new supply in Portugal over the next decade," Ruia states. This creates a clear investment thesis: acquire, renovate, and rent out properties to meet modern standards for a professional clientele.
Actionable Steps for Today's Buyer- Focus on Renovation: Target properties in need of modernization in well-connected neighborhoods in Greater Lisbon and Setúbal. Your investment in quality kitchens, bathrooms, and energy efficiency will command higher rents and attract reliable tenants.
- Understand the Mid-Term Niche: Cater to digital nomads and relocating professionals by offering fully-furnished apartments with flexible lease terms (e.g., 6-12 months).
- Analyze Regulatory Shifts: The move away from Alojamento Local is an opportunity. Properties previously used for tourism can be converted to generate stable, long-term rental income.
- Advocate for Tax Efficiency: While the tax burden can be high, partnering with local experts can help navigate the system. As Ruia notes, a reduction in VAT for renovations would be a major boon for this investment model.
The mid-term rental market in Lisbon offers a compelling blend of high demand and limited supply. Explore opportunities with realestate-lisbon.com.
