LISBON, Portugal — Lisbon’s city council voted late Friday to cancel roughly 4,000 short-term rental licenses in the historic center over the next three years, the most aggressive move yet by a European capital to claw back apartments from the tourist market and return them to residents.
The measure, approved 10 to 7 after a six-hour session, targets parishes where registered tourist apartments exceed 20 percent of housing stock, including Santa Maria Maior, Misericórdia and parts of Estrela. License holders will be given 18 to 36 months to convert the units to long-term leases or sell them, and owners who do so before the end of 2027 will receive a five-year exemption from municipal property tax.
“We are not banning tourism. We are saying that a city is not a hotel,” said Teresa Vilar Baptista, the council member for housing who sponsored the measure. “In Alfama we have streets where there are more key boxes than doorbells.”
Portugal has struggled for a decade with housing costs that have outrun wages. Median rents in Lisbon have risen 94 percent since 2016, according to the national statistics institute, while median gross salaries have grown about 31 percent. The city has about 19,800 registered tourist units, roughly one in every 15 homes, a share comparable to Barcelona before that city began its own phaseout.
The vote drew an immediate rebuke from the Portuguese Association of Local Accommodation, which said it would challenge the measure in the administrative courts. “Thousands of families bought and renovated these apartments legally, under rules the state wrote,” said its president, Rui Monteiro Lage. “You cannot change the contract and call it urban planning.” The association estimates that short-term rentals support about 24,000 jobs in the Lisbon region.
Economists are divided on how much relief the measure will bring. A 2025 study by the Nova School of Business and Economics estimated that each 1,000 tourist units converted to residential use lowers average rents in the surrounding parish by about 1.2 percent. “It helps at the margin, and the margin matters when people are being priced out,” said Catarina Sequeira, a housing economist who co-wrote the study. “But Lisbon’s real problem is that it built almost nothing for 15 years.”
On Saturday morning in the Mouraria neighborhood, where graffiti reading “Habitação, não turismo” has become ubiquitous, residents greeted the news cautiously. Fernanda Lopes, 68, who has lived in the same third-floor apartment since 1981 and whose landlord declined to renew her lease last year, said she had stopped expecting much. “They vote, the lawyers fight, and the tourists keep coming,” she said. “I will believe it when I see a family move in downstairs.”
The mayor’s office said the first cancellation notices would be mailed in January.
A version of this article appears in print on Oct. 11, 2026, Section A, Page 5 of the European edition with the headline: Lisbon Votes to Cancel 4,000 Short-Term Rental Licenses in Bid to Cool Housing Market.
