VIRTUAL Lisbon Livable Cities

Abstract

This paper examines the effects of gentrification and the housing crisis in Lisbon and Madrid, focusing on the challenges young people face in accessing affordable housing, as well as innovative solutions such as converting historic neighborhoods into protected housing. Both cities have experienced significant increases in rental prices due to the proliferation of tourist apartments and real estate speculation. In Lisbon, rental prices rose by 65% between 2015 and 2022, with over 30% of housing in historic neighborhoods like Alfama or Moraira, being allocated to the tourist market. In Madrid, rents in central areas such as Malasaña and Lavapiés increased by 40% over the last decade, limiting access for young people and local families. In both cases, rental costs exceed 40% of many tenants’ incomes, highlighting a conflict between urban revitalization and the displacement of young and low-income local residents. The impact is profound: 70% of young people under 30 in Lisbon cannot afford to rent or purchase housing. In response, the government has introduced measures such as banning new tourist apartments and the “Mais Habitação” program, aimed at social housing. In Madrid, the Municipal Strategy for Youth Housing promotes the construction of affordable homes and subsidized rentals for those under 35. A notable solution is the conversion of historic buildings into protected housing. Lisbon’s “Reabilitar para arrendar” program has rehabilitated over 1,200 housing units since 2015, while in Madrid, projects like the transformation of “La Corrala de Embajadores” offer social housing while preserving cultural heritage. Initiatives such as rehabilitating the “Palácio dos Marqueses de Abrantes” in Lisbon or the author´s project “Alfama 2.0”, integrate heritage restoration with modern livability standards. These policies aim to balance historic preservation with the right to housing, fostering local economic growth and mitigating the negative effects of gentrification.