Lisbon

Lisbon’s housing crisis is marked by severe affordability issues, with property prices and rents reaching record highs due to a sustained imbalance between limited housing supply and escalating demand, notably fueled by foreign investment and policies like “golden visas.” Residential property prices in Lisbon have risen over 120% since 2015—far outpacing both wage growth and the EU average. Median asking prices in Lisbon are now above 5,700 euros per square meter for apartments, and recent appraisals value properties in the city at over 2,800 euros per square meter, showing annual increases near 20%. Construction of new housing remains drastically below requirements; in 2024, under 23,000 new dwellings were completed across Portugal, while permits for new builds fell to 22,100 units, further tightening the market.

The housing crisis in Lisbon most acutely affects renters, who face rents exceeding 800 euros monthly for modest apartments, often while earning salaries near the national average of 1,000 euros. Vulnerable populations—including low-income workers, older adults on fixed pensions, and young people—struggle most to secure stable housing. Many face precarious living conditions or homelessness; single earners and families compete for scarce affordable homes. The crisis is especially severe in central Lisbon and prime districts, but it also impacts long-term residents displaced by rising costs and the conversion of dwellings to tourist accommodations. Banks and local analysts describe the housing situation as “unsustainable,” warning of further strain if supply shortfalls persist.

Housing in Lisbon remains expensive and highly competitive, with both house prices and rents continuing to rise due to limited supply, strong demand from locals and foreigners, and persistent supply constraints. As of 2025, about 27% of households in Lisbon rent their homes, while around 73% are owner-occupiers, reflecting national patterns. The median price to rent in Lisbon is approximately 22.4 euros per sqm per month, meaning a typical 80 sqm apartment costs nearly 1,800 euros monthly. Median prices to buy an apartment stand at about 6,425 euros per sqm across the city, with prices in the center and prime districts reaching over 9,000 euros per sqm.

Publicly owned housing plays a very small role in Lisbon, representing just about 2% of the city's housing stock, which is among the lowest shares in Europe. Social rental—housing rented at below-market rates based on income—is even lower, at about 1.1% of all dwellings. In Lisbon, all social housing is publicly owned; there is virtually no nonprofit or private sector involvement. The terms "public housing" and "social housing" are used interchangeably in Lisbon, both referring to municipally or state-owned dwellings rented to those in need at regulated rents, though a minority of public rental stock may be “affordable” rather than “social”.

Lisbon’s city administration has recently reinforced its strategy for affordable and sustainable housing through the 2023–2032 Municipal Housing Charter, which emphasizes strengthening public housing, supporting nonprofit and cooperative projects, and incentivizing private sector affordable housing. The administration has set concrete targets as part of Portugal’s national goal of delivering 59,000 new affordable homes by 2030, with an investment of 4.2 billion euros—Lisbon will benefit significantly from this pipeline, especially via the 1st Right – Access to Housing Assistance Programme, aimed at delivering thousands of new and rehabilitated homes to vulnerable families.

Key programs include: the 1º Direito program (1st Right), focusing on new construction and rehabilitation for disadvantaged populations; the Supported Rent Program, which adjusts rents to tenant incomes; and the Porta 65 – Jovem, which subsidizes rent for young adults. Major recent policy actions involve public-private partnerships for redeveloping vacant properties, streamlined licensing for new housing, tax incentives for moderate rental supply, and expanded mortgage guarantees for buyers under 35. There are also measures to convert tourist lets and vacant dwellings for long-term rentals, and new frameworks to fast-track affordable housing projects, particularly in priority urban expansion zones. Overall, these efforts blend immediate expansion of social and affordable housing with longer-term reforms on planning, finance, and land use to improve access and sustainability.