Why rent in Lisbon costs almost three times the minimum wage – 05/31/2023 – Market

“The landlady has been after me since 2018. She says she needs my apartment and I already got an eviction order.”

Georgina Simões is a caregiver in a nursing home in the Portuguese capital, Lisbon. She earns just above the minimum wage.

Her rent, at 300 euros (about R$1,800) a month, is low by current city standards, but she still has to work two jobs to pay it.

And the condition of the property is bad: you can’t shower because the water leaks into the neighbors’ apartment.

“I’m not leaving because when I look for other houses my salary is not enough, not even to pay the rent. The rents are higher than the salaries we have in Portugal”, he says.

Simões’ circumstances are far from unique. The average rent in Lisbon is now around US$2,140, ​​while the minimum wage hovers around US$814.

The causes of the crisis

Portugal is currently facing a serious housing crisis, caused in part by the increase in foreign investment in properties and the lack of new affordable housing.

But it’s not just a question of supply. Researcher and activist Rita Silva, who helped create the Habita housing movement, said that “there are more houses than people, but prices are not going down”.

The expert added that the current situation, which led to numerous campaigns calling for more affordable housing, spread across the country for several years after the 2008 financial crisis.

The case of Simões, the caretaker, is already in court and she expects to stay on the property for another six months. Her lawyer is trying to buy this time for you.

What happens if he loses?, the BBC asked him.

“I’ll be on the street,” he replied.

“I don’t have a chance, I don’t know what will happen. I just need a roof over my head, I spend my life working,” he added.

extreme sacrifices

Joelsy Pacheco, in turn, reconciles two jobs that consume 16 hours of her day. One of her jobs is in an intensive care unit in one of the main hospitals in Lisbon and the other in an NGO.

“Most of my salary goes to rent, not counting bills, food and transport. With just one job it would be almost impossible”, he narrated.

Pacheco’s lease expires at the end of this year and he fears the rent will go up.

“Where would I go now? I’ll probably have to move back in with my mum, away from work, and I’ll have to restructure my whole life,” he admitted.

Earlier this year, Portuguese comedian and activist Diogo Faro inadvertently became one of the faces of the popular housing movement after posting a video on social media about rising rent prices in Lisbon.

Soon, her inbox was flooded with messages.

“There are divorced couples who can’t move because they can’t afford it, which I think is brutal. Older people who are choosing between paying rent or medicine, shorten their lives to have a roof over their heads,” he said.

As he received more and more stories like this, the comedian got together with some friends and started the Home is a Right movement.

His and other movements planned a demonstration that drew more than 30,000 people to the streets of Lisbon last April. The protests later spread to other cities, such as Porto and Braga.

“We call the protests ‘A house to live’, because people are desperate. People want a house to rest, play with their children, to live in”, said Faro, who sees this as just the beginning of the fight.

Tourism is one of the culprits

The mayor of Lisbon, Carlos Moedas, described the housing problem as “the biggest crisis of our generation”.

He made the comment in April, when construction began on a new affordable rental development in Entrecampos, a central area of ​​the Portuguese capital, which will provide 152 new homes.

Programs were also created to help those who cannot pay the high rental prices, with local authorities offering to pay a third of the cost, said the councilor for Housing and Development of Lisbon, Filipa Roseta.

A third of Lisbon’s historic center is unoccupied, according to geographer and housing researcher Luís Mendes, and recent cases suggest that the State is making the situation worse.

When some favelas were destroyed in March, eight families were left homeless and had to be sent to emergency accommodation.

“We are talking about rental prices in Lisbon that are higher than in some of the richest areas of Berlin, for example, where there is an income limit. Not to mention the wage difference,” said Mendes.

“In Lisbon there are areas where a house of 80 square meters costs US$1,285 a month. Well, that is the average salary of a Lisbon person. So, we are talking about prohibitive values, I would even say obscene”, added the specialist.

Mendes said that one of the factors for the current housing crisis that the country is suffering is what he calls “touristification” and that occurs when, due to the increase in tourism, houses intended for housing are used to accommodate temporary visitors.

Areas such as the historic quarter of Alfama, known as the home of Fado, now have 60% of their homes for short-term rentals.

“What are the tourists going to see? Each other?” Faro joked.

speculative investors

Then there are government measures aimed at attracting foreign investment through tax exemption programs for investment funds, digital nomads and, above all, golden visas.

“Gold visas allow investors from outside the European Union (EU) to obtain a residence visa in Portugal for investment, and which allows them to enter the Schengen Area (EU countries that have no borders between themselves)”, explained Mendes.

“Often, [os beneficiários do visto gold] renovate a house, but do not occupy it. Often these properties are sold repeatedly, and this creates a distortion in the real estate market and is one of the causes of the crisis. of housing”, said the specialist.

As part of a new housing program, the government is ending gold visas and short-term rental permits, as well as limiting rent increases to 2%.

However, for most citizens, these measures are too few and too late.

This text was originally published here.