Landlords slow to embrace Lisbon’s rent guarantee program
Reservations and room rates are way down, but landlords have hope tourism will pick up
Portugal’s capital Lisbon is a few months into a program meant to bring units in the city off the short-term rental market and into its affordable housing stock.
Landlords so far have been slow to embrace it, but that could change if the coronavirus pandemic continues to hammer tourism in the city, according to Bloomberg.
The city’s Safe Rent program requires landlords to commit to long-term affordable renting for at least five years. Lisbon’s government pays a guaranteed 1,000 euros per month in rent for units in the program.
The average monthly revenues for some Airbnb listings, including four-bedroom units, has fallen well below that figure since mid-March or so, when the coronavirus pandemic began to impact cities around the world. Last year during this time, average monthly revenues for a four-bedroom listing hovered around 3,500 euros per month.
The number of reservations in the second quarter were just 10 percent of reservations in Q2 2019.
Most short-term landlords are holding out for now, hoping that that reservations would pick back up in the typically busy summer months, according to Eduardo Miranda, head of the Association of Local Accommodations in Portugal.
“This hasn’t happened yet and many of these owners may be considering other alternatives at the moment, including the safe rent program in Lisbon,” he said.
There are also concerns among landlords that they’ll have to pay a load of taxes upon transfer of units from short-term rentals to traditional long-term leasing. [Bloomberg] — Dennis Lynch