Report Details Growing Impact of Tourism on Portugal's Housing Market
A comprehensive analysis of Portugal's major cities, particularly Lisbon and Porto, reveals increasing structural challenges linked to the sustained growth of the tourism sector. The daily experience for residents in historic city centers is now characterized by congestion and queues, but deeper socio-economic impacts are causing significant concern, most notably within the housing market. According to data from Pordata, the median bank appraisal value of homes in Portugal rose by 90% between 2011 and 2024. In Lisbon, the increase was even more pronounced, reaching 125% over the same period.
This sharp rise in property values contrasts with a 41% increase in the average net monthly salary for employees, as reported by the National Statistics Institute (INE). The disparity highlights a growing affordability crisis for the local population. The report identifies the proliferation of Alojamento Local (short-term rentals) and the purchasing power of remote-working digital nomads as key factors exacerbating the pre-existing housing shortage, pushing the market toward an unsustainable state.
The economic pressure extends beyond housing. The cost of an essential goods basket has increased by over 30% since early 2022, and data from Eurostat indicates that more than half of Portuguese residents spend 30% of their monthly budget on food. While not solely attributable to tourism, the presence of a large transient population with higher spending capacity contributes to inflationary pressures on local goods and services. This is also evident in the restaurant and hotel sectors, where rising prices are making them less accessible to domestic consumers.
The report notes that this phenomenon is not unique to Portugal, with similar situations observed in Paris, Madrid, and Rome. These cities are also experiencing a transformation of their urban commercial landscape, with traditional shops being replaced by tourist-focused businesses. In response to growing local discontent and protests, some municipal governments have begun to implement regulatory measures. Examples include the revocation of short-term rental licenses in Barcelona and the implementation of a 90-night annual cap in London and Paris, although the report suggests enforcement of these rules has been weak.
Other strategies cited include Amsterdam's ban on new tourist-oriented stores and Santorini's daily cap on visitor arrivals. The introduction of daily tourist fees, as seen in Venice, is another popular but contested measure. Despite these efforts, the report, citing Bloomberg, suggests that no European government is actively seeking to reduce overall tourism numbers due to the sector's significant economic importance.
In Portugal, tourism's contribution to the economy was €34 billion in 2024, accounting for 11.9% of the Gross Domestic Product, according to the INE. This economic reliance creates a policy dilemma for the government: how to manage the negative externalities of tourism without undermining a critical pillar of the national economy. The report concludes that while tourism reached historic highs in 2023, its contribution to real economic growth has since moderated, suggesting a potential shift in its overall economic impact.
Discover rental property opportunities and regulations at realestate-lisbon.com.
