Portuguese capital fights Airbnb dominance after tourism dive

70airbnb diveJust in the last decade, Portugal’s capital city has cut its energy use and climate-changing emissions, installed one of the world’s biggest electric-car charging networks and expanded cycling, walking and public green space. The shifts have eased air pollution, cut costs and this year led to the city being named Europe’s “Green Capital” for 2020 - the first such designation for a southern European capital.

But Lisbon still struggles with a city centre hollowed out by high housing prices and a proliferation of apartments turned into short-term Airbnb tourist rentals, which forces many workers to motor in from homes in the suburbs, says Mayor Fernando Medina.

Now officials hope to turn a new challenge - the coronavirus lockdown, which has flattened many European economies - into a tool to wrest Lisbon onto a more sustainable housing path. Under a new Renda Segura - “secure income” - programme, the city is trying to lure apartment owners who turned to short lets to ride the city’s tourism boom into renting to locals instead, with a city-guaranteed return.

Currently about 25,000 apartments are registered as short-term lets, about 8% of the city’s total, said Medina, who has led Lisbon, a city of a half-million people, since 2015. The Renda Segura idea pre-dates the coronavirus pandemic, the mayor said, but as tourists stay home, Lisbon’s empty flats - and owners’ dwindling bank balances - may now make the offer more enticing.

So far, about 100 apartment owners have expressed interest in the plan, which aims to secure 1,000 housing units this year, Medina said. “Right now they are getting nothing. We have made a solution for them,” the mayor said.

Under the 4-million-euro deal, owners who agree to rent their flats to locals for five years will pay no tax on the rental income, which will be guaranteed by the city, said Medina, an economist.

The city will offer the flats to young and middle-class residents at rents amounting to no more than a third of their net income, subsidising the difference between that and the market rate for landlords, the mayor said.

The plan aims to draw back into the city centre residents who fled soaring prices as tourism surged - while cutting commuting, congestion and air pollution, he said. “We want a city with less pollution, with more people, with much less inequality and with many more opportunities for all,” said the mayor, who took over a green push started by his predecessor António Costa, now Portugal’s prime minister.

Medina recognises winning over landlords is likely to be a big challenge, with memories of tourism windfalls still recent and hopes for a quick rebound high in the ocean-front city. “I believe many of the owners are betting tourism is going to recover and they’re going to see it as it was before,” he said. “But I think they are not betting well”.

The coronavirus lockdown has accelerated other green changes in Lisbon too, Medina said, from expansion of walking areas to the addition of about 100 new public spaces, most by September.

More than 100 km (62 miles) of new cycle paths are scheduled to be built before next spring, about 80% of them this year, with new routes focused for the first time on connecting homes and workplaces, he said. Medina views the coronavirus pandemic as “the moment to speed up the sustainabity agenda”, which in Lisbon has focused on reducing city sprawl, cars and commuting, and producing a denser, cyclable city with more affordable housing.

“We need to be bold and to act fast. We have a window of opportunity and we need to use it,” he said. One huge help in pushing ahead now is wider understanding of the benefits of some of the green changes, with cycle paths and public squares getting heavy use during the lockdown and Lisbon’s air becoming clearer than normal.

“There are signs that people are more aware and willing to make things different,” he said - though the risk of people getting back into their cars, particularly with fear of public transport high at the moment, was substantial, he added.

The mayor also hopes to persuade businesses to back proposed changes such as more home-based working and staggered work hours for employees who do come in, to cut congestion and make distancing possible on public transport systems, he said.

Both the city government and national government have said a quarter of public employees will now work from home. “It’s possible and people want it,” he said.

Lisbon already has a “Green Pact” in place with more than 200 companies in the city to help it work with business on environmental action. The pact led to earlier deals on bike parking, room for electric vehicles and sustainable energy use, the mayor said. Now, to make more progress on a green recovery, he said, the key will be to find measures that are not just eco-friendly but that people see as sensible.

“If there are not practical solutions... it’s going to be difficult to move forward this agenda,” he concluded.

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+3 #4 Stuart Wood 2020-07-02 12:06
Quoting JC:
Everything about Airbnb is bad.It destroys neighbourhoods by filling othwerwise civilised places with roudy,too many to a room high turnover tourists.

The Algarve is facing a similar nightmare tio Lisbon.

The only people that benefit are the smug money grabbing landlords,most of whom I bet dodge taxes anyway.

Ban Airbnb

Would be good to also ban electric scooters and bikes. Last visit to Lisbon (pre lock down) was a nightmare caused by constantly dodging these things, being forced to walk in roads to avoid being run over, as well as every major site seeing experience being spoiled, including the Castle. How did those things even get up there? Another money grab.
+4 #3 JC 2020-06-30 16:33
Everything about Airbnb is bad.It destroys neighbourhoods by filling othwerwise civilised places with roudy,too many to a room high turnover tourists.

The Algarve is facing a similar nightmare tio Lisbon.

The only people that benefit are the smug money grabbing landlords,most of whom I bet dodge taxes anyway.

Ban Airbnb
+4 #2 Mark Holden 2020-06-30 12:02
airbnb has practically no costs, yet takes a huge cut of the hotel trade on the whole planet.
Their business model, like uber, is to simply ignore existing law, using their huge financial power to steam roller local government.
Residential apartments aren't hotel rooms; except with airbnb, suddenly they are.
Meanwhile, small property residential landlords are punished by PT tax rules and tenants rights laws.
If Portugal wants to make more residential rentals available, start by leveling the taxes paid by small landlords.
That money doesn't come from the sky, it comes from tenants. It's a big part of what makes tourist rentals far more profitable than long term residential rentals.
+10 #1 Susan Harrington 2020-06-30 09:14
Great policy but it needs a xountrywide roll out and is desperately needed in the Algarve where the wages are so low. How can you earn minimum wage and pay €700 a month for a one bedroomed flat. It's impossible.

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