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Lisbon mayor floats plans to turn Airbnb rentals into homes for key workers

Lisbon's Alfama neighbourhood, Portugal
Lisbon's Alfama neighbourhood, Portugal Copyright Armando Franca/AP Photo
Copyright Armando Franca/AP Photo
By Alice Tidey
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The Portuguese capital has launched a programme urging landlords to stop renting short term, promising tax breaks and guaranteed rent.


Lisbon is aiming to cut the number of Airbnb-style short-term rentals and boost affordable housing in the city by giving landlords taxation perks, according to the city's mayor.

The new Secure Income programme launched in the Portuguese capital aims to enable key workers to return to the city centre after being priced out due to a tourism boom.

According to Mayor Fernando Medina, about a third of Lisbon's city centre properties are currently used as holiday rentals. This, he wrote in The Independent, has pushed up rental prices and hollowed-out communities.

"Now we want to bring the people who are Lisbon’s lifeblood back to the centre of the city as we make it greener, more sustainable and ultimately, a better place to both live and visit," he said.

"Prioritising affordable housing for the hospital staff, transport workers, teachers and thousands of others who provide our essential services is possible. We’re offering to pay landlords to turn thousands of short-term lets into 'safe rent' homes for key workers."

Nearly 23 million international tourists visited Portugal in 2018, boosting the sector by 8.1 per cent year-on-year — the highest rise in the EU — and contributing €34.8 billion to the country's economy.

About €1 in every €5 in Portugal comes from tourism with the sector employing more than 20 per cent of the country's workforce, according to research by the World Travel and Tourism Council.

Lisbon, which numbers 500,000 inhabitants, welcomes about four million tourists annually.

The city's attractivity has led to strong demand for short-term rentals, according to the real estate firm CBRE. It estimated that rental prices in Lisbon in early 2018 were 21 per cent higher than at the same period the previous year.

The average monthly rent was calculated at $1,682 (€1,492).

The COVID-19 pandemic and the lockdown measures introduced to curb its spread have severely hit the short-term rental market and although bookings have since rebounded, risks of a second wave will continue to dampen the tourism sector.

This is leading some to predict that the pandemic could usher in a return to more traditional long-term rentals, seen as less vulnerable to sudden shocks.

Lisbon landlords who sign up to the Secure Income programme are guaranteed a monthly income for five years, the municipality says in its pitch. They will also be exempt from paying income tax on the rent.

The city hopes to enroll 1,000 properties in the scheme before the end of the year. So far, they've received 177 applications.

For Medina, the benefits of fewer short-stay rentals will not only be social but also environmental.

"This approach will also help tackle the climate crisis and improve public health. Denser cities mean fewer people commuting into the centre each day. Fewer vehicles on the road means less pollution and harmful emissions that poison the air we breathe, while also contributing to global warming," he wrote.

In a statement, Airbnb said that it "helps local families stay in Lisbon and 60 per cent of local hosts say the additional income they earn from hosting means they can pay the bills and support their families."

"We take local concerns seriously, which is why we already work with the government to help hosts follow the rules and pay tax. We will continue working with everyone in Lisbon to ensure that travel on Airbnb benefits local families, businesses and communities," it added.


The Portuguese capital is not the only European city hoping to curb Airbnb's prospects.

Ian Brossat, deputy mayor of Paris in charge of housing, said in May that COVID-19 and subsequent fall in short-term rentals provided the city with "a unique opportunity to switch properties previously listed on Airbnb to conventional rentals and ensure that they again benefit Parisians."

The French capital is looking at buying properties bought as investments and leased exclusively as short-term rentals from landlords who have been hard-hit by the COVID-19 crisis.

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