Portugal's Housing Crisis: A Case For Staying Home
Dive deeper into Portugal’s housing crisis, where rising rents, digital nomads, and political policies create overlapping challenges that make it harder for locals and immigrants to stay in their homes.
Story and photos by Joy Grant
I visited Portugal in November 2024, and it’s hard to describe, but there was a restlessness in the air. Almost every conversation with a local eventually turned towards politics, whether the topic was a lack of housing, excessive tourism, or the outcomes of recent elections. The evidence of the underlying tension was everywhere, from posters advertising protests lining the streets to “Tuk Tuks go to Bangkok” (referring to the Southeast Asian taxis that are rising in popularity among tourists) spray-painted throughout neighborhoods. While eating at a restaurant in Alfama, Tuk-Tuks consistently passed the building, hogging most of the street. “Worst tourist trap ever,” my waiter scoffed as one passed blasting Dua Lipa’s latest song at an obscene volume. The dissension isn’t just about the issues themselves, though; it’s about something much deeper. Many feel they’re fighting against cultural erasure.
If you’re considering moving to Portugal with intentions of a slower, richer life but don’t realize your relocation drives up costs and accelerates the loss of culture, you might be a part of the problem. Before moving, consider the impact of your decision not just on your life but on the lives of the people who have been there for generations. When gauging the benefits ask yourself, are they worth someone else losing their home?
With the power of this choice comes the responsibility to consider the whole picture and understand how your temporary decisions can have a lasting impact on both the community you’re leaving and the one you’re retreating to.
No amount of supporting local businesses or involving yourself in the local community changes the fact that your presence negatively affects others, especially those who are already marginalized. Although daunting, the real solution may be staying home and strengthening your community.
The Players & Their Roles
Portugal’s housing crisis is often portrayed as a conflict between locals and foreign buyers, but the reality is far more complex. The broader problem is not just about real estate; it’s about the deep, systemic shifts that political policy triggers in communities. The solutions to Portugal’s housing crisis will vary depending on who you ask. What’s clear, though, is that the actions of one group often ripple out, influencing the lives of others. Understanding these overlapping challenges is the first step toward finding solutions to a crisis that affects many.
The Pawns
The most numerous but most vulnerable represent those with the least control.
Locals: the lifelong residents struggling to stay in the game. Their movements and power become more limited as foreign money floods the board.
Non-Western immigrants: many come seeking better opportunities but find themselves pinned by endless obstacles with little hope of advancing.
The Royal Court
Those with more power and flexibility.
The Government: with control over policy, sits safely behind its pawns, moving across the board with ease. By prioritizing foreign investment, it leaves its own pieces exposed.
Western immigrants: the powerful pieces who are privileged with more money and can maneuver with a freedom local residents and non-Western immigrants can’t afford.
The Government: The Policymaker & Facilitator
At the center of Portugal’s housing crisis is the government, both as a policymaker shaping the rules of the game and as a facilitator whose decisions (or lack thereof) determine who receives the perks of an expanding country and who is left to deal with the growing pains.
Portugal was one of the hardest-hit countries during the 2008 recession, ultimately requiring a €78 billion bailout. In response, the government introduced the Golden Visa Program in 2012 to attract foreign investment, offering residency to non-EU nationals who invested in sectors like real estate, business, and research. The real estate option required participants to invest between €280,000 and €500,000.
Portugal’s Golden Visa program stood out for its relaxed rules, including low investment thresholds, minimal residency requirements (just one week per year compared to Greece’s 7-year requirement), and family benefits. It became highly popular, attracting foreign investment and boosting the country’s economy. By 2023, Portugal had received over €7 billion from the program, contributing to a budget surplus. The government also started offering tax breaks to expats, hoping to encourage them to move to Portugal. Within a decade, the number of foreign residents grew by 40%.
The government succeeded, so why are so many people upset?
While foreign investors reaped the benefits of Portugal’s new policies, many locals saw their everyday lives flipped upside down. Real estate investment quickly became the most popular Golden Visa option and with little regulation on where and how many properties could be bought, housing prices soared and rent prices swelled. Since 2015, home prices in Portugal have more than doubled, and rents rose by 36% in 2023 alone.
Meanwhile, over half the workforce earns less than €1,000 a month. Consequently, many who had weathered the brunt of the recession suddenly found themselves priced out of their own neighborhoods. The government neglected to implement strong rent control policies or make plans to raise the local income, leaving its people defenseless to rising costs.
With tensions mounting, the government has received many critiques for not keeping the market in check. Eventually, the real estate option and unfair tax breaks were removed in October 2023. But many believe it’s too little, too late.
In response to the numbers and an outcry from its residents, this year, the government has started making strides toward addressing the housing crisis. With one of the EU’s lowest public housing rates at 2%, Portugal recently began correcting this by budgeting €2.8 billion to build 59,000 public low-cost housing units in the next five years. They have also created legislation that allows for the reclassification of rural land for urban use. Additionally, the government has introduced tax breaks for young workers and direct financial assistance to low-income tenants.
While these efforts look promising, housing prices will likely continue rising until at least 2026 due to demand. Despite government intervention, many believe the damage is already done. Foreign investment continues to dominate the market, leaving locals with limited options.
Locals: The Displaced & Struggling Residents
For many lifelong residents, staying in Portugal feels less like playing the game and more like trying not to be sacrificed. During a tour of Mouraria, my local guide consistently pointed out the freshly painted white walls, which contrasted the once-vibrant street art that used to define the neighborhood. Artists and the government continuously reclaim and repaint the walls, each marking their territory in an ongoing battle for the neighborhood’s identity. The city that residents have known for decades, the one defined by its cobblestone streets, traditional Fado music spilling out of cafés, and tight-knit communities, is rapidly changing.
Housing and tourism are critical issues, however, they are symptoms of a much larger issue: the loss of community. While many argue that tourists are good for the economy, Portugal’s tourism industry is monopolized by international conglomerates, leaving locals with little to show. Small business owners to tour guides, have shared that their conversations often circle back to a single question: Who is Portugal really for anymore? The very essence of Lisbon is at risk of becoming nothing more than a backdrop for Instagram photos rather than a place where people live, work, and grow.
Plans for a 150-room hotel in the Graça neighborhood have sparked protests, further highlighting tension between locals and the forces of gentrification. In a city already struggling with the impacts of excessive tourism, the approval of this project has felt like a final blow to those fighting the transformation of their neighborhoods into tourist attractions.
Graça, already reeling from rising rents and displacement, faces further erosion of its community fabric. The Quartel da Graça, a former convent, was granted to the SANA group for the project despite protests about the lack of environmental studies and public consultation.
As highlighted in an Instagram post from Stop Despejos, a collective fighting for housing rights, the hotel threatens the character of a neighborhood known for its tight-knit community. Protesters argue, “The Graça barracks is a public building and therefore must be a space for those who live, work, or study here, whether they are children, teenagers, or adults, Portuguese or foreign.”
For residents, this hotel isn’t just another luxury development; it’s the latest chapter in the gradual erasure of their homes, their culture, and their way of life. And while protests have made headlines, many locals feel like they are running out of time to reclaim what has been lost.
Non-Western Immigrants: The Overlooked Workforce
While locals struggled with displacement, another overlooked group faced even greater obstacles: non-Western immigrants. For many non-Western immigrants, the game feels rigged from the start, with every move met by obstacles that keep them from advancing. Over the decades, as Portugal’s migration patterns have shifted, these communities have remained vulnerable, particularly when it comes to securing stable housing.
Following the Carnation Revolution in 1974 and the consequential decolonization of Portugal’s overseas colonies, returning colonists flooded a strained job market. When Portugal became a member of the EU in 1986, notably two things happened. First, returnees gained access to better job opportunities across the EU, and immigrants from former colonies arrived, drawn by cultural ties, shared language, and job prospects in growing industries.
This migration flow quickly became a symbiotic relationship. By 2015, stricter immigration policies in Northern Europe led a new wave of migrants to Portugal, which had one of the most lenient pathways to citizenship and, ultimately, an EU passport. Among the largest groups were South Asians, drawn by a lenient citizenship pathway. Previously, undocumented immigrants could gain residency simply by finding a job. This provided stability for immigrants and helped fill vital gaps in Portugal’s agriculture, construction, and domestic services, where they often form the backbone of the workforce.
Unfortunately, the government had no plans of making sure these people would have access to housing once in the country. When the housing crisis became crucial, these communities were hit the hardest. With few protections and rights, non-Western immigrants are faced with the same housing limitations as locals, however, they are also vulnerable to exploitation from employees and landlords. This became overwhelmingly clear following a 2023 Lisbon house fire, which not only revealed 16 South Asian migrants were being sublet a single studio apartment but also left two of them dead.
In 2024, Portugal tightened its immigration policies, requiring a work visa for entry. What was once a difficult but navigable system became a bureaucratic dead end, trapping many in precarious jobs without a path to legal residency. Without the possibility of gaining legal status through work, many find themselves stuck in a cycle of risky employment and housing instability.
Their experiences underscore the brutal truths and a need for comprehensive solutions that address immigration, labor rights, and housing access, or Portugal’s dependence on immigrant labor will continue to conflict with the realities that these communities constantly suffer.
Western Immigrants: The Unintended Gentrifiers
To some, moving abroad is a fresh start; to others, it’s a powerful piece claiming more space on a crowded board. While expats’ reasons for migrating may seem frivolous in comparison to non-Western immigrants, they’re often still valid. Some relocate due to issues with the healthcare system, a desire for an improved quality of life, rising costs of living, or dissatisfaction with the political or social climate of their homes. While these are legitimate reasons, the issue begins when these are the only problems that Western immigrants can see, and they’re blind to the strains their presence creates in the local community.
With the world becoming more globalized and travel becoming easier, the last 15 years have seen many more Westerners migrating. For example, the number of Americans living abroad rose from 29.3 million in 2005 to 40 million in 2019. Since COVID-19, the numbers have grown significantly with the flexibility of remote work, creating a path for digital nomads and governments like Portugal, who are creating visas to draw them specifically.
But it’s important to recognize that Westerners leaving their home countries is not the same as non-Western immigrants leaving theirs. Many non-Western immigrants are not leaving by choice, they are fleeing economic collapse, political instability, and climate disasters. Often, they are sending money back home, actively strengthening their communities in ways that their governments have failed to do. They are not welcomed into new countries with open arms, nor do they arrive with financial security or the privilege of choosing a life of ease. Meanwhile, Westerners (especially Americans) are often embraced as desirable expats, granted pathways to residency, and given an easier transition, all while driving up local housing costs and deepening inequalities. The impact is not the same.
Immigrants from higher-income countries often earn more money and usually unintentionally become gentrifiers while living in lower-income destinations. When planning to move abroad, instead of looking at the market and finding something that is reasonably priced, they will often look to spend more than locals on everything from housing to food, services, transportation, entertainment, and more, eventually driving prices up for everyone.
Not only does this create an economic disrupter, it disrupts the local culture as well. Everything from the architecture to the decor to the music played in stores changes to cater to one subset of people. And what about the people who were left behind? Is it fair that the everyday burden of dealing with the issues at home is left to them when they often have the least power and control?
Wide-Ranging Consequences
The desire to leave home when things get rough is understandable, there are good reasons to seek a better quality of life elsewhere. But is there an ethical way to do so? I understand the fear of opening your phone and worrying that you’ll read a headline with more news of your rights slowly being stripped away. I know the devastation of working hard for a life that seems to be constantly pushed out of reach by a system built on oppression and greed. But Westerners moving to Portugal, or anywhere else, don’t just escape their own problems; they bring consequences to the places they settle.
Portugal, despite its appeal, isn’t free of issues, especially for Black and Brown people, racism exists and the government in recent years is shifting further right. The sense of safety that some Black Americans feel there isn’t necessarily because Portugal is inherently better; it’s because their money affords them a privilege that shields them from many of the struggles faced by local Black and immigrant communities. And for many, the instinct is to lean into that privilege rather than question it. While this is a problem that the government is at the root of and has the ultimate responsibility to fix, it’s cruel and short-sighted to act as though those who take advantage of the situation aren’t also part of the issue.
Recognizing that privilege is the first step, but what matters more is what we choose to do with it. If there was ever a time to take action, to show up to community meetings, to hold politicians accountable, to fight against harmful policies, it’s now. It’s not too late. But if those of us who recognize the problem and have the means to leave do, it will be too late.
Generations before us rarely had the opportunity to flee the U.S. when their rights and quality of life were threatened. Their fight is the very reason recent politics are so jarring to us; they did the work to bring this country to a more inclusive and free space. Instead of a reason to leave, the situation in the United States should serve as a reminder that Democracy isn’t something that just exists, it has to be fought for, constantly. If Americans dissatisfied with the country’s political direction choose to leave instead of staying to push for change, who is left behind to fight? What happens to our already vulnerable communities? These communities are the least likely to be listened to when it comes to policy and change. In conversations with those considering the move, one response stands out to me the most, “I just want to leave for a while and maybe return when things get better.” But I want to be very clear, there is no guarantee that things will improve unless those with the most power and resources to positively impact change, stay.
It often feels as though people want to benefit from the work of others rather than build stronger communities at home. But at what cost? Once again, the question has to be asked: Are you okay with contributing to this problem, or do you want to be part of the solution?