Lisbon, a beautiful, hilly, coastal city famous for its historic cultural capital and the authenticity of its local life, is becoming unrecognizable. Yet, gentrification is rapidly changing its neighborhoods and gentrifying its character. In recent years, an influx of remote workers, foreign buyers, and professionals from various sectors has altered the city’s character and demographics. This rapid shift has forced local residents to start organizing to push back against displacement and the erosion of social capital in their communities.
Tourism and a wave of new arrivals have both driven gentrification in Lisbon. Most of these transplants find jobs in advertising, insurance, and technology fields. As these newcomers settle in the city, property prices have skyrocketed, reaching an extraordinary price-to-salary ratio of 21:1. The ongoing real estate boom has driven up housing prices, squeezing long-time residents out of the market for affordable homes. This has led to increased fear and insecurity among residents.
Longtime local cafes, or tascas, have experienced a stunning renaissance. They’re more popular today than ever, serving a younger, richer clientele as Instagrammable brunch spots, replete with beautiful marble accents. This trend paints a much wider picture of the movement away from genuine local businesses to businesses catering to wealthy tourists and new residents. Foreign buyers are a big part of this, outspending local buyers by an average of 82% per property.
The Portuguese government has introduced tax benefits for attracting foreign workers. These incentives incentivize people who exit and re-enter Portugal to pocket exempt foreign income from the tax man by exempting them from income tax on foreign earnings. Remote workers from across the globe have made Lisbon a popular destination. They find themselves passing most days in co-working spaces with plenty of English signage.
The gentrification process has not only impacted the housing market, but local businesses as well. Development A hotelier has announced plans to demolish a traditional Ginjinha shop to build a hotelier-controlled, commercialized version. This abrupt move comes after months of confusion and concern from community members. Many residents across the political spectrum believe their culture and heritage are being lost to an influx of more affluent transplants.
As Hiwote Getaneh, a naturalized U.S. citizen who moved to Lisbon, explained, “I was happier here, my nervous system calmed and so I thought, why not apply for the visa?” She shared her alarm about her own security as the threat of the far-right continues to grow. “With Chega in office and neo-Nazi rallies happening, I sense my safety is changing,” she said.
The far-right party Chega has found significant success in Portugal’s typically consensual political landscape, rising to become the leading opposition party in parliament. Aside from its disasters, its rhetoric has set off fire alarms across marginalized communities, especially climate-change immigrants from Bangladesh, Nepal, India and Pakistan. Yet it is these communities who continue to deal with prejudicial treatment, and who are some of the communities most negatively impacted by the changing social landscape in Lisbon.
So too are Portugal’s farmers, whose agricultural industry is largely dependent on immigrant labor. Experts say that without these workers, the fare-free industry wouldn’t have survived. Lisbon is undergoing rapid demographic changes. There is now a deepening divide between the locals who profit from inherited property and the foreigners who make foreign money.
Chris Jones, a local entrepreneur and short-term rental owner, pointed out the amazing jump in foreign-born residents since he moved to Starkville in 2019. “When I first got here in 2019 there were about 450,000 foreign-born citizens in the nation. Today there are 1.5 million,” he stated. His small company, Paco, has sprung up to cater to this new domestic arrivals by offering services specifically catered to foreign newcomers. “Paco has grown from a necessity,” he continued.
Businesses like Paco have gone even further to champion local hiring. “Through the company’s success we have provided good, above-market salaries for many young Portuguese staff – three of whom recently have managed to buy houses,” Jones explained. This community success story highlights the positive and negative aspects of gentrification.
Not everyone views gentrification positively. Today, Administrator Nadia Sales Grade dramatically raised the stakes by advocating for significantly higher taxes on corporations and billionaires. She argues that they’re not doing their fair share to grow the economy. “There has to be more taxation for both the corporations and those not contributing to the economy,” she asserted.
The huge difference in pay between locals and expats adds to the irritation. Alex Couto expressed his frustration at Portuguese workers that have to compete with expats who will take jobs at lower rates. “There is something that pisses me off when an expat in Portugal offers me a low day rate just because I am Portuguese,” he said. He acknowledged some benefits of gentrification: I know, I know, look— I’ve been on this blog for the past 2 months telling everyone I’m a leftist who wrote a book attacking neoliberalism and all that jazz, right?
As remote work becomes popular worldwide, a new trend has more Portuguese expats benefiting from Portugal’s generous tax regime. Ms Fabiola Mancinelli presented the idea that visas should target independent people. These people help grow the economy by stimulating advancement and innovation without taking jobs away from natives. “Applicants must demonstrate they are self-sufficient… they’re expected to bring their job with them,” she explained.
Even with the economic boon that gentrification can provide, much of the local population is still haunted by the burden of change encroaching on their neighborhoods. One local woman in her sixties expressed the desire to stay in Lisbon. She says her sense of safety is eroding due to the tensions that have popped up in their neighborhood.