Due to the drastic decrease in the number of tourists, the city of Lisbon is transforming Airbnb apartments into affordable houses and is subletting the flats to locals. As in many other popular European tourist destinations, Lisbon counts a huge number of Airbnb flats, which have drastically increased real estate prices for locals. But since the pandemic started, tourists have stopped visiting the city and the flats are empty. Lisbon is thus offering to rent those empty apartments, turning them into affordable housing for its citizens.
This risk-free initiative offers landlords up to 1,000 euros a month if they lease their apartment to the city for a minimum of five years. The city will then sublet those flats to local people who qualify for affordable housing. Rental prices will differ depending on the tenant’s income. Generally, prices will be one-third of their salary. This initiative has two positive effects: on one side, it gives a new use to the flats which otherwise would stay empty; on the other side, it places affordable housing to the real estate market.
Even though 1,000 euros might be less than some of the landlords could have earned from tourists, the guaranteed five-year revenue stream could attract many of them anyway, especially in this difficult time characterized by high uncertainty. So far, around 200 landlords have signed up.
We need to make a shift. It should change the way the housing market works here in the city.
Mayor of Lisbon Fernando Medina
But the city’s initiative comes with a monition for flat owners in the historical center: once they sign a long-term contract with the city, they won’t be able to return the property to the short-term rental market. The city has allocated a budget of €4 millions for the program, which will allow 1,000 properties to take part into it. The Portuguese national government is offering to double this number if there is enough interest.
“There is that tension: too much of a thing is not good, but too little of it is a problem. It’s a question of balance. Having a house cannot be such a burden that you have to have two or three jobs – that’s not a dignified life for anyone.” said Fernando Medina
Covid-19 has turned out to be an opportunity to reinvent many sectors; and this is true also for the housing. Back in May, Balakrishnan Rajagopal, the United Nations envoy on the right to housing, told Reuters that, “Just as employment and work are likely to change profoundly as a result of the Covid-19 crisis, housing is likely to change as well. I hope we see it as an opportunity to reimagine housing for the post-Covid-19 world.” Many governments have started doing that. Venice, for example, has struck an agreement that will see some tourist flats rented to university students. Amsterdam has recently banned vacation rentals in the old town and has imposed some restrictions on rentals in other neighborhoods. Simultaneously, the Czech Republic has introduced a new legislation to better regulate tourist flats.
