Lisbon Tenants Spend 116% of Monthly Income on Rent, European Council Report Reveals
A report prepared by research teams at the European Council has identified Lisbon as the European city where tenants are required to dedicate the largest portion of their monthly income to rent, at an estimated 116%. The findings were released ahead of a meeting of European leaders in Brussels convened to address the escalating problem of housing affordability, which has become a major social and economic concern across the Union. The Spanish cities of Barcelona and Madrid were also ranked among the most expensive, with tenants in those cities allocating 74% of their monthly income to rental payments. These statistics underscore the intense pressure on urban housing markets, a key topic in our geographic and sector deep dives.
The document provides a broad overview of the rental market across the European Union, noting that the average cost of rent has increased by 58.3% over the past decade. However, several countries have experienced far more dramatic surges. In Portugal, the increase was 147%, while Hungary saw a 237.5% rise and Bulgaria a 137.5% increase. In contrast, some markets remained more stable; Finland recorded a slight price decrease of 0.4%, and the smallest increases were seen in Italy (13.3%), Cyprus (13.7%), and France (26.7%). The report attributes the growing pressure on rental markets to a surge in demand, particularly in economically dynamic urban areas, which has not been met with a corresponding increase in housing supply.
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In response to the crisis, some national governments are reportedly considering measures such as regulating rental prices, implementing subsidy programs, or forming collaborations with private investors to expand the housing stock. However, the report notes that the long-term effects of such interventions have yet to be fully assessed. The issue has gained prominence at the highest levels of the EU, with European Commission President Ursula von der Leyen stating her intention to prioritize the housing crisis. She emphasized that access to housing has become a significant source of anxiety for many European citizens.
The debate among European leaders is expected to explore what can be done at a European level to reinforce national, regional, and local initiatives. This discussion will also inform the development of the future European Affordable Housing Plan, which is set to be presented by the European Commission. A public consultation for this plan, which concluded last Friday, gathered 6,321 contributions. The majority of responses (90.7%) came from individual European citizens, with 244 submissions originating from Portugal. The highest levels of participation were recorded in Italy (1,279) and France (1,052), indicating widespread public concern over the issue. For those looking to navigate this environment, connecting with English-speaking real estate agents can provide crucial local insights. Stay informed on Lisbon property market developments at realestate-lisbon.com.