Portugal ending ‘golden visas’ amid housing crisis
- The golden visas policy was introduced in 2012 when Portugal’s economy was struggling and needed foreign capital
- But one effect of the policy was to push house prices up as foreign arrivals bought into the property market
Portugal announced on Thursday a hefty package of measures to tackle a housing crisis, including the end of its controversial “golden visa” scheme and a ban on new licenses for Airbnbs and other short-term holiday rentals.
Rents and house prices have skyrocketed in Portugal, which is among the poorest countries in Western Europe. Last year, more than 50 per cent of workers earned less than €1,000 (US$1065) per month while in Lisbon alone, rents jumped 37 per cent in 2022.
Low salaries, a red-hot property market, policies encouraging wealthy foreigners to invest and a tourism-dependent economy have for years made it hard for locals to rent or buy, housing groups have said. Portugal’s 8.3 per cent inflation rate has exacerbated the problem.
Prime Minister Antonio Costa said the crisis was now affecting all families, not just the most vulnerable.
It is not clear when the measures, worth at least €900 million, will come into effect. Costa said some would be approved next month and others will be voted on by lawmakers.
A mechanism would be introduced to regulate rent increases, he added, and the government will offer tax incentives to landlords who convert tourism properties into houses for locals to rent.