Lisbon Converts 1,200 Tourist Rentals Into Housing for Local Residents

Lisbon City Council passed new short-term rental caps on July 7 that restrict platforms to 90 days per property annually in six central parishes. Property owners who convert to long-term leases gain priority access to municipal renovation grants while platforms face higher licensing fees.

Housing Pressures in Central Parishes

The measure responds to a 2025 municipal audit that recorded 14,800 active short-term listings, up 22 percent from 2023 levels. Rising visitor numbers have pushed average monthly rents in Misericórdia and Santa Maria Maior to €1,180, according to the city’s housing department records. Long-term residents in those parishes now compete directly with nightly bookings for the same apartments.

Families seeking three-bedroom flats in the Baixa-Chiado area stand to gain the most immediate relief once owners shift properties to 12-month contracts. Retirees on fixed incomes who have lived in the same buildings for decades receive first refusal on converted units through the council’s housing registry. Commercial landlords who previously earned peak-season revenue from foreign visitors will lose that income stream unless they meet the new annual cap.

Budget Allocation and Timeline

Council documents allocate €4.2 million from the 2026 municipal budget to subsidise conversion costs for owners who register as long-term landlords before December 31. The same papers project that 1,200 units will move from tourist to residential use by mid-2027. Enforcement begins with a new digital registry that cross-checks booking data against tax filings starting January 2026.

Next steps include a 60-day public consultation period on the detailed licensing rules and a separate vote on increased inspection staffing in September. Residents can submit address-specific concerns through the city’s online portal until September 5. The housing department will publish quarterly compliance reports once the registry goes live.