Portugal’s digital nomad bubble
politico.euCurrently living in the Algarve after moving to Lisbon with my partner for her studies years ago.
I know a few non-crypto entrepreneurs who came here for the NHR (non habitual resident scheme - the scheme mentioned in the article which allowed for the 20% tax cap on foreign income).
I can confirm that a lot of them were incredibly frustrated with the bureaucracy they encountered, not just when dealing with the government, but generally in everyday life. Most people have war stories related to accountants, lawyers, banks, telecom companies or landlords. The real kicker was when they realised that the 20% didn’t include social security payments, bringing most of them (those that didn’t pay hefty fees to set up companies in tax havens, and pay themselves exclusively in dividends) to an effective rate that wasn’t that far off what they’d be paying elsewhere. Needless to say the expat churn has been quite high.
Regarding Airbnbs and rising housing prices - I’m no economist but intuitively, I’ve always thought it made more sense to blame the explosive growth in tourism Portugal has had in the last decade or so (6M tourists visiting Lisbon, a city of 500k people) rather than the 10-20k digital nomads. Would be curious to know if anyone has better numbers or studies.
Expats complain about bureaucracy everywhere. A German expat in Sweden will complain about Swedish bureaucracy. A Swedish expat in Germany will complain about German bureaucracy.
It does not mean anything. Expats complain about everything.
I moved back to my native Netherlands after several years abroad and encountered significant problems with the bureaucracy, more so than in any foreign country I've lived. I don't think it's an expat problem, rather it's a "if you fall slightly outside of the happy path then you can expect to run in to a lot of trouble"-problem. It's just that expats are a group of people that fairly frequently tend to fall outside of the happy path.
This is it, 100%. Anything non standard and you get the long forms instead!
By the way, I've lived in a few European countries and researched many others. The Netherlands was by far the easiest/most efficient in terms of bureaucracy.
> Anything non standard and you get the long forms instead!
If only. Instead you run in to catch-22s and simply get a shrug and "it's not possible".
The big downside of being the "easiest/most efficient" is that it deals with exceptions poorly; once you fall outside of the "efficient" workflow you're screwed. Lots of people run in to problems with this and people literally become homeless because of this. Ironically, it's easier if you're actually homeless and sleeping on the street – as opposed to being homeless and having enough money to stay at hotels or are temporarily staying with friends – as there are some special exceptions for people registered at the salvation army and such.
This is exactly why I a native Swede had to leave Sweden for Ireland. Im now back in Sweden and jesus christ the bureaucracy is insanely streamlined and optimised for the upper middle class happy path people. Everyone else is looked upon with confusion and disgust.
My favourite story of this is where "falling out of the happy path" included my parents being self-employed and the sheer surprise that people can have wildly differing income per month :P
This is my main reason for having a BV in the first place: to ensure that even though the business takes in very variable amounts of money my private income stream is extremely regular. It makes taxes a whole lot simpler. The only thing I still have to take care of privately are the occasional dividend payment but that's an easy thing to do.
Anybody with > 100K euros in income from consultancy (which should be most of them!) living in NL should consider doing the same thing. There is some overhead but that's easily farmed out to an administrator.
I'm interested to hear if you ever compared with Sweden, just for the sake of curiosity. As an immigrant here coming originally from a very bureaucratic country (Portuguese + Italian levels of dysfunctional bureaucracy, with a Latin American cherry on top) I found bureaucracy here a complete breeze. I basically only need the internet to do 90%+ of my bureaucratic needs with the odd visit to an agency's office for getting documents expedited (national ID, driver's licence, etc.).
As far as I can compare with some immigrant friends in the Netherlands I feel Swedish bureaucracy is on the same level or even less burdensome than the Dutch one.
I have a Dutch neighbor who married a Turkish woman. They run a couple of successful companies, and their goal is to relocate to Rotterdam where his family is from. He wanted to incorporate a company in NL, and transfer his current business there. Because he lives abroad, despite being a Dutch citizen, he was not able to open a business bank account, so he was not able to open a company on his own. His options were to move home or get everything executed in his brother's name until he's ready to move (which he choose).
Of course, he also complains heavily about the bureaucracy here, which is equally broken but in a different way.
I have heard the same from some Dutch people I know, particularly around the topic of the tax office.
Agreed. Expats don't remember the bureaucracy they had to deal with in their own countries, because they did it:
or simply their parents took care of most things when they were young/born/growing up.- over the years - step by step - with the help of their parentsThen they arrive in a new country and realize what it's like to administratively become a functional resident. You probably got your first bank account in your teenage, your national IDs as a newborn, etc. Then you move elsewhere and you need to create all these things from scratch and discover them also.
Fully agree. I will add two things.
First, most "digital nomads" who interact with the public administration and institutions (e.g., banks) are not standard customers. Employees often have no clue how to deal with them and many processes contain manual steps that require someone's validation or approval, and often target a very small group of individuals (those tasked with "dealing with" foreigners). It can slow down things.
Second, Portugal is particularly well known for having great ideas and conferences about digital transformation but completely lacks the ability to deliver within its own ranks. To its defense, most citizens cannot easily purchase services online, either because lack of money, or because lack of computer literacy/equipment, or because they don't even have an online payment mechanism. These factors greatly limit incentives for a rapid digital transformation, which incidentally, is precisely what digital nomads crave for.
The comparison with Switzerland was made earlier, it matches my argument: 1) widespread computer literacy and modern endpoint equipment 2) widespread access to online payment solutions 3) the population is used to pay-as-you-go public service (vs. all-inclusive taxpayer service expected by citizens in most EU countries). These combined greatly encourage the deployment of efficient online interfaces.
Clearly you haven't been to the efficient country like Singapore, Switzerland.
Off course YMMV. But that's not the rule in general.
I have recent experience with Korea which is overall quite efficient in fact, and yet it's still a struggle to figure out what I need to do, how to do it, and language barriers don't help.
If a Korean goes to your country and they only speak Korean, is it going to be easy for them?
If they go to California places like the DMV will provide them a free Korean-English translator service. Under AB 60 an undocumented Korean could get a driver license and a free translator service to obtain it. If I am an undocumented immigrant in Korea will they provide a translator for me to get state ID as an "illegal" immigrant?
Honestly I would be shocked if you could point me anywhere else in the world where a Korean could be illegally staying, go to the motor bureau and not only get a free translator but get an official state ID and driver license.
https://www.dmv.ca.gov/portal/customer-service/interpreter-s...
Swiss bureaucracy is expensive but it’s swift, easy, and very cordial. I’ve never lived anywhere that was so good on paperwork. Exchange my non EEU drivers license? A week flat and about 100.-. Getting a residence permit? 100.- approx and less than two weeks. Questions about your tax return or filing? An email to the cantonal tax office and you’ll get an (encrypted answer) within a few days.
That’s only about the government though, private companies are hilariously terrible at customer service or paperwork especially compared to US/Canada.
You mean, private companies are "streamlining their customer service" or whatever the name of the day is. And it's not only in Switzerland, everywhere it's just incredibly hostile, to the point where you feel like smashing some office windows just because.
It feels more like the general attitude is “you should be glad we’re letting you give us your money. Now shut up and go away.” You’ll never get an apology, never get an easy refund because they goofed up. No. You’ll struggle, waste your time, and get nowhere.
But I guess this is an EU thing compared to what I’m used to in Canada and the US.
Seconded. I moved from Sweden to Switzerland (Aargau) and I was in awe of how little nonsense there’s been.
This is likely the best comment in this thread.
No, Portugal is different. To give you perspective: it takes 2-3 years to exchange a foreign driver license (most foreigners I know drive illegally by now), a lot of administrations frequently “lose” applications and ask you to do it again when they have too much backlog (this cost me hundreds of dollars in back and forth, certified documents etc in the past).
It’s also very common for administrations to have no one answering the phone/email. And most administrations are appointments only. So often, you kind of have to drive to different places, maybe different city halls, and hope that someone has a contact with an internal e-mail address and can hook you up. That’s just how it works. It’s the most barbaric administration and closest to a third world country I’ve experienced, and I’m French, so I know something about red tape.
Takes 18 months to get permission for your foreign spouse to move to Sweden. It then takes 12-18 months to get into the social system - you register quickly, but for the bureaucracy to actually add you into the system takes that long. So no, you're wrong. Portugal is not different.
It's not really the delays that make Portugal different, arguably most countries have long delays, it's the lack of reliability, transparency, and responsiveness.
I don't know Sweden. But we're a family of expats with multiple citizenships, so I deal with bureaucracy in 4 countries on 3 continents. Most countries have streamlined procedures, provide tracking numbers, addresses to send things in, phone lines... So it's long, but you know what's going on and what to do.
Here, even lawyers don't even know what to do. For a similar situation to get my partner a visa from within the country, we simply couldn't speak to anyone. Even the lawyer told us "well, you might have to wait a year or two to see if they re-open their ability to take new appointments." We eventually were able to get through after hustling like crazy, me driving to many different city halls to speak to officials there. Someone eventually knew a colleague there, and got us an appointment for 6 months later in a city 3 hours drive away. We showed up, it was a butcher. Their Google Maps pin was not even in the right place. Cherry on the cake. After getting turn-by-turn instructions from the butcher (who apparently does that 10 times a day), we eventually found their office.
Idk, never been to Sweden but I don't think you can compete with that :-D
Now I get it, they're vastly understaffed, Portugal is a small country. They're doing what they can.
You don't understand. It's not about Sweden, Germany, Portugal. As an expat you always deal with this. Indians waiting for green card lottery and then another 100 years? But I'm sure you will come up with a reason why that's different. You need to take a step back and become aware of yourself.
Public offices love to slap fines for being late on people. I think people should be entitled to the same fees if the offices are late.
That was not our experience 8 years ago, it was much faster.
To note, this isn't always true.
My family moved to Portugal in late 2020. Covid played havoc as they had to find ways to digitalize many things their offices were doing. It took my wife 9 months to get her DL exchanged and me 11 months.
During that time, you are not driving illegally; you are driving from your foreign license. As long as you have the paper with the exchange info and a picture, you will be fine.
It also helps if you hire a relocation expert who knows the system. We paid ~$1,500 to a Portuguese American lady who helped us with everything. She handled setting up all our health care, apartment negotiation and contract review, set up all our utilities and phones, all our residency paperwork, DL exchange, bank account, and more. I highly recommend her and any group like her. They know how to work the system. My mom does similar back in the USA for newly arrived expats for companies.
Covid was a real shock to office-heavy organizations; it has been a mad scramble to change culture, paperwork, operations, etc. I think they are doing decent and hopefully, in 5 years, it is night-and-day difference.
I've lived in Egypt as well... the bureaucracy there worked really well (before revolution). I just had to go to a giant building and spend half a day there, done. Sure I had to taxi to a DSL place to pay, but that was pretty easy as well.
> It also helps if you hire a relocation expert who knows the system. We paid ~$1,500 to a Portuguese American lady who helped us with everything. She handled setting up all our health care, apartment negotiation and contract review, set up all our utilities and phones, all our residency paperwork, DL exchange, bank account, and more. I highly recommend her and any group like her. They know how to work the system.
In the third world, that's called a tout, and they're a symbol of corruption and inefficiency. The only thing missing seems to be bribes paid to move your papers from one desk to the other faster.
Not sure what 3rd world means anymore as the cold war is over :), but I think I know what you mean.
What they are called now is a "relocation expert", and they help set everything up for you. They are in no way a symbol of corruption or inefficiency, but rather a professional who knows the system. IE, to get a DL you go this office, you fill out this form, you fax it to x, etc.
Do I wish everything was 100% online and designed with high UX standards? Sure, I also would love if it rained M&Ms on Fridays at 4.11pm :). Both of these things are not going to happen.
Hey neighbor! So glad it was faster for you. My experience is that these things vary greatly based on where you apply, and pure luck. I know people in the Algarve who have been waiting for 3 years. And people who applied in Lisbon and got it like you within 1 year.
Ah good point, I know our person who helped us had some good tricks like using offices not in Lisbon which were busier. We live up North so it was all very easy.
Most third world countries with such bad/slow bureaucracy solve those issues with bribery. I'd hate to live someplace that both has low corruption and such high bureaucratic burdens.
Could you give some examples of these countries?
Bali, $100 and you have a valid driving license in one day. Without a bribe it's almost impossible even apply
lmao
There is bureaucracy and then there is bureaucracy.
Here is an example: Malaysia and Indonesia. Each country has its own bureaucratic nightmares but you can make useful comparisons.
Malaysia: Easy to get a phone number. Easy to get an internet hotspot to get data. Reliable internet. Internet is fully open (no censorship).
Indonesia: Hard to get a phone number. Confusing choices and prices with Whatsapp/FB mingled in the choices. Have to submit your passport photo to some dodgy dude, who has to get a certain authorization. Took half a day for the Internet to activate. Data is not very reliable. Heavy censorship (not even Reddit works!) so have to get a VPN to do any meaningful browsing.
So sure as an expat you'll face bureaucracy but some countries' issue is beyond bureaucracy, it's that the process is fundamentally broken and no one gives a shit. This makes you lose significant time for relatively simple things (at least in other countries).
> Heavy censorship (not even Reddit works!) so have to get a VPN to do any meaningful browsing.
This depends on your ISP I believe; Telkom blocks Reddit, but I believe others do allow it. You don't need a VPN to bypass it, DNS-over-HTTPS will do as well.
In general things in Indonesia seem to be ... complicated. Just buying something at the local Indomaret sometimes seemed to involve typing an entire essay on a computer.
"some countries' issue is beyond bureaucracy, it's that the process is fundamentally broken and no one gives a shit." Haha. Love it. That sums up a lot of Portuguese administrations sadly.
I'm not sure about Portugal, but a few years ago my wife was studying in Spain on a study abroad program. She is from another EU country, and we'd visited Spain a few times, so figured it would be easy. Pretty much every step of the way we encountered so much more bureaucracy (I am an immigrant to her country) than we could even imagine. She spoke Spanish, but if she didn't it would have been a million times harder.
For example we wanted to get internet in the apartment we were renting. The local ISP (Orange) said that we needed a Spanish bank account, we said that we had a European account so could make an IBAN transfer, but apparently that wasn't an option. So we went to the bank and they said my wife needed a letter from the police. So we went there, and after showing all her university documents and waiting there for half a day, she got that. By that time the bank was closed, so we went back the next day, and after another few hours she had a bank account. We made a transfer of a few hundred euros from our other European account at home, then once it arrived a few days later, went back to the ISP. They took our details and the first payment, and then we figured everything was fine.
A month later the first bill came and we tried to pay but it was declined, tried to log into online banking and that was blocked too. We went back to the bank (BBVA) and they said our account had been closed due to suspicious activity (the only transaction we made was the initial payment for the internet) and there was nothing they could do. So we went to visit the ISP with the intention of paying in store, but they said it wasn't an option. We explained the situation and said there was nothing they could do, we could only pay with a Spanish bank account. In the end we had to get a friend to make the ISP payment for us, every month while we were living there.
Compare this to where we live now. You simply make payments to an IBAN bank account, so it can come from anywhere in Europe. If you need a local bank account, you can easily do so in any bank (I opened an account before I was officially living there, i.e. without any local ID, just my passport) or use something like Revolut. If you need to get a local phone number, you just go to the supermarket and buy a prepaid SIM for €1 - no ID needed.
This is a fairly long story but only one part of this seems like genuine "bureaucracy":
> We went back to the bank (BBVA) and they said our account had been closed due to suspicious activity (the only transaction we made was the initial payment for the internet) and there was nothing they could do.
That's an absolute nightmare (though I don't understand how you weren't notified, or what the recourse typically is for accounts closed due to "suspicious activity".
The rest can be summarized as:
* A business wants billing from a local bank account (not universal, but not unusual)
* Opening a local bank account needs some information confirming your identity, which the police can do.
* Getting these forms isn't instant
* Banks don't have long opening hours
In the UAE, I downloaded an app, submitted my docs and my details, and got my card the next day (I went to a bank branch - not the branch of my account but just a random branch to get it printed on the spot, even though they offered home delivery, because I wanted to see the process).
In the UK, I visited a nearby Lloyd's branch and got my account open and my stuff in under an hour.
In India and Switzerland, the bank sent a representative to my place, where they did everything from a handheld device, including verification. Done in an hour and got my card by mail in 1-2 days.
The stuff you mentioned in your summary are excuses and not valid ones at all.
When i was was apartment hunting in barcelona 7+ years ago and failed straight for weeks to get a single reply on idealista, and went to the real estate agencies and found they had siestas, still, in barcelona, i quit the country. good to visit, not to live.
ps: when i wanted a bank account, the people there acted like they didn't spoke english, until it was clear they won't give me an account, then suddenly english was not a problem.
No, they don't have "siestas". In Spain usually all retail closes from 2pm to 5pm. I wouldn't expect to go to a UK venue and have a normal dining timetables (for me as Spaniard), because I understand things work different there.
mr nacho trying to justify a Spanish tradition. fair enough. but I'm still bold enough to complain about it. it's super annoying when restaurants close from 2 to 5. also I doubt anybody from the foot soldiers actually takes a siesta. it's most likely just basically a variation on unpaid work or being on call unpaid. so, nobody benefits of it except the owners who just optimize the schedule for their purposes.
Unfortunately cold emails are generally ignored. The general etiquette in Spain is that you have to establish a relationship with someone in the business before they respond to emails, and then it also depends on the individual if they like to use email or not.
> and went to the real estate agencies and found they had siestas, still, in barcelona,
I'm not seeing your issue here. This has been well-known for a century, so don't show up during the siesta time.
"I want to live in a foreign country, but they need to change to be like my home country!"
Why didn't you learn Spanish?
Oh, I had lot of negative experiences with BBVA in USA. Those guys has no clue how to do SEPA payments, declining regular debit card payments on e-shops like DigiKey as fraud (according to them I am suppose to train their systems so it will stop doing that) and in general their support sucks.
Where do you live now (if you're comfortable sharing)?
Had similar awful experiences with Santander and ISPs in Madrid :(
You moved to another country and did one single banking transaction there in a month? That seems like something you have to actively try in order to do. Right? Why did you try?
I see someone downvoted me. Perhaps because it was just an idle question and quite insubstantial?
Thinking about it now, it seems a little bigger than I realised when I wrote it.
I too moved to another country and got a bank account. When the people at the bank asked what I needed, I said something like "well, I'm here to stay and will need all the things regular people have, an account, a card, probably a house loan someday, can you advise me about what I should get today?". Maybe I hadn't yet decided that I wanted to stay for decades when I said that, but the person behind approved of the answer, I could tell.
Saying something vaguely like "I'll do the minimum necessary here and whatever possible in my old country" simply isn't a great way to talk to the people at the bank, at the immigration authority, at the waterworks, all the people who can make your move simple or less so.
No. I'm an expat in Switzerland and dealing with the government and other institutions has been great - can't even call it a bureaucracy.
For reference, I found the UK pretty sensible, Spain frustrating, and my native south american country a nightmare.
Argentina!
Uruguay, close enough!
Well, that's not exactly always true. I've had zero problems with bureaucracy since moving to Australia. My case has been that everything just works - minimal human involvement, and when it's present - it's pretty optimized.
I think that due to the high cost of labour (highest minimal pay in the world) and lack of labour due to higher speed of development - whatever that can be automated has been automated.
Same experience in NZ - you only start to see how hopeless europe is when you come back. I had 0 interaction with gov clark in nearly a decade in NZ, while in europe any sort of errand would require in face meetings. Even some digital forms would just email the form to a person in ivory tower for validation, who’ll tell you to visit office anyway…
Europe is not one place with one single bureaucracy.
Of course some places are better, but overall it's clearly blind to own faults.
"Europe".
Counterpoint, in France the vast majority of bureacratic things can be done fully online. Last time i had to go in person was for a passport/ID card, so there are multiple good reasons (photo, biometric info, confirm your identity) for that. Some of the websites are not great, and sometimes they send you a confirmations by mail, but otherwise a pretty painless experience.
Do you still need 3pieces of paperwork or permits just to buy a car?
Except when you're an expat in a country that actually knows what it's doing, like Singapore. Bureaucracy here is A+, and is the yardstick we should measure every country against.
What's wrong with complaining about sprawling bureaucracy? I can only see downsides and no upsides. Don't you want it to be eliminated? I think people are not yet complaining enough.
Unless you can complain with actionable complaints (It'd be great if i could fill this form on a website instead of on paper and mailing/faxing it), it literally serves no purpose.
Actionable advice: eliminate this step in the buraucracy that does not serve a purpose. When can I expect implementation of my idea?
I'm an English immgrant in France - lots of my compatriots complain about French bureaucracy but in all honesty it's far more efficient and accessible than it is in the UK.
Slightly off topic but I see this often enough and I’m curious to know, when do you call someone moving to another to work an expat instead of an immigrant.
You immigrate (verb) into a country. That makes you an immigrant (noun) of your new country.
You emigrate (verb) out of a country. That makes you an emigrant (noun) of your old country.
You expatriate (verb) to a country, from your homeland. You are an expatriate (noun) (aka expat) if you live in a country other than your native one.
For example, an American-born man who moved to Germany for part of their career and is living in Vietnam for retirement would be an American expat, who immigrated to Vietnam and emigrated from Germany.
You are often all 3 of them at once, depending on perspective. Colloquially, expats usually emigrate out of their homeland for specific reasons, usually either climate, culture, taxes. Eg. someone would expatriate to Portugal to take advantage of the tax scheme (this article), or maybe expatriate to Mexico for 'better' weather, or maybe expatriates to Paris for the cultural experience.
It is often assumed or implied that an expat has no intention of "integrating" in the culture of their host nation. Eg. an American in Mexico that moved for the weather wouldn't raise children there or apply for citizenship, but simply enjoy retiring on the beach and taking advantage of the cheaper CoL. They may still primarily speak English and seek out fellow Americans-in-mexico to socialize with instead of the locals. Conversely, a full Mexican family (parents+kids) that moved to America "for a better life" may not be considered an expat, since they intend to become citizens of America and raise their family as Americans. That is why expats sometimes have a poor reputation in their host nation, compared to other "immigrants".
I moved abroad on a work assignment. As soon as I decided to stay in the country long term, I stopped calling myself expat and labeled myself an immigrant instead.
Someone moving from a wealthy country to a poorer one is an expat.
Someone moving from a poor country to a wealthier one is an immigrant if they intend to stay for life, and a migrant if they don't.
That's why you have American expats living in Thailand and Mexico, but Thai immigrants and Mexican migrants living in America.
The English speaker divides humans into 3 categories:
- White people with the burden (see: https://en.m.wikipedia.org/wiki/The_White_Man's_Burden )
- White people without the burden
- People of colour
When a person in the first category moves to another country, they are an expat; people from the other 2 categories are immigrants or migrants, as they prefer to say nowadays.
For instance I’d have to take a significant pay cut if I wanted to be the British prime minister but, belonging to the second category, I am an economic migrant. An American or Swedish teenager working in a Starbucks in Berlin is an expat.
Expats are usually on temporary visas and don't apply for citizenship.
immigrant is a person legally or illegally coming over here and stealing all our jobs and taking all our benefits and not even working or speaking the language.
expat is a person moving to another country and getting paid a high salary.
> those that didn’t pay hefty fees to set up companies in tax havens
I suppose it depends on your definition of "hefty" but a couple of thousand USD is usually sufficient, depending on jurisdiction, and obviously is expected to pay for itself many (, many, many) times over.
It's not that hard and it's not just for the 1%. Especially if you're anything approaching a "digital nomad" I can't think of any reason why you wouldn't establish a consulting company somewhere offshore, bill from that, pay yourself a quarterly dividend and then import only the money you actually need.
I’ve not looked into it personally, but I’ll relay what I’ve heard from various people who have looked into this or successfully done this.
In one case one person, as you say, did everything on their own and pays a couple thousand every year to keep the entity in the favourable jurisdiction. When asked if it was all above-board, they said it was one of those grey areas where they hoped the govt didn’t look too deeply into it, but so long as they weren’t making millions they weren’t worried about an audit.
The other cases asked various accounting companies to set this scenario up for them (one to establish a software engineering consulting company, others to set up other companies). The responses ranged from “yes we can do this, it’ll cost you 15-20k upfront, then 5k in annual upkeep” to “no this isn’t looked upon too well by the Portuguese govt”.
Well, your first example is a good "what not to do". Doesn't sound like much of a "grey area" if they're living in fear of being found out. I don't understand this kind of setup - financial information is permanent and once governments get their shit together there will be no safe havens, and this will apply retroactively. People playing such games are going to feel a lot of pain some coming day, I suspect.
I have to admit I don't know anything about Portugal but with a little research it is very possible to find a territorial tax-based country to live, where one does not owe any money on overseas income, and live completely legally there as a tax resident, taxed only only your minimal local salary - if that. Now I suppose that's not for everyone but if people were moving to Portugal specifically for tax reasons then I'm surprised they didn't, you know, check it out a bit first.
If you live in Portugal for longer than 6 months every 12 months you are considered a resident and taxed accordingly. I suppose you could go in and out every few months to escape that.
Just to note, it is a little bit more complicated, as there are other aspects of a tax residency test as well. IE, if it is your "home" as dictated by some other rules it can be a tax residency even with less time spent there.
I can think as ethic concerns about tax elusion as a (big) reason why one wouldn't establish an offshore entity
If you're living offshore and paying taxes to the place you live, there's no particularly good justification (except might makes right) for the US to force you to pay taxes. AFAIK it's the only country, both now and in history, to claim taxation rights over its citizens perpetually no matter where they are.
the comment chain was to which you are responding was not about trying to pay taxes only to the country you're living in (which basically everyone in the world can do minus US citizens), it was about setting up a company in a tax haven (think Cayman Islands) to avoid paying taxes at all because they decided they are too high, which of course raises questions about the morality, legality, and practical details of such a process
> I can confirm that a lot of them were incredibly frustrated with the bureaucracy they encountered
You need someone (in Spain it's called gestor) who does all of that for you. I live in Portugal, by now I speak the language but I don't get the rules etc. I have a guy who does everything, never had any issues. It's very cheap.
Does he take crypto as payment? If yes, pls pass me his contact :)
> Regarding Airbnbs and rising housing prices
Didn't they recently crack down on Airbnb's, adding requirements that should theoretically lower the drive to turn unoccupied housing into Airbnb's (essentially limiting people purchasing flats with this intention)?
The digital nomads are going to soak up a good 3 to 5% of the total housing on a permanent basis, that's a pretty good dent in the reservoir. Tourists predominantly stay in hotels or other short-stay places. Though AirBNB and so on also result in the conversion of some of that available housing into short stay 'hotels' which will put more pressure on that reservoir. Typically in any city the vast bulk of the housing is spoken for, and only a relatively small part is available for newcomers or people that move out of their parents place when they come of age.
So I would not underestimate the impact even if it is only 10 to 20K individuals. Finally: tourists spend a lot, typical budgets are many 100's of euros / day for a family. Digital nomads comparatively little.
There is no lack of space in portugal to build housing in.
The "housing crisis" is 100% a political choice by portuguese voters.
Young Portuguese have been emigrating for the last 50 years. The country is full of second residences, bought by people who took advantage of cheap real estate until recently. Blaming today's inflation and cost of living on a few digital nomads or crypto people doesn't make much sense.
What also chocked me when visiting Lisbon or Porto is the number of old abandoned buildings in what I would consider nice areas. I have always wondered what was the reason for that...
Re abandoned buildings: it’s likely due to the inheritance laws for Portugal, which are unique in the way things are automatically split upon deaths and require official signoff from all parties that are inheritors for sale. If another death occurs, then their own more inheritors for that individual.
also frozen rents: too many buildings have elders paying 50 eur rent that is frozen for decades
So landlords have no option to evict them, don't make enough money for any kind of renovations, have no option but to wait until the elders pass away and the units become available
My family is currently trying to get title to a property that should be inherited and the amount of buyouts and legal squabbles it requires just so we can repair this decrepit old building is astounding.
My guess is most families that emigrated to the US and have some inheritance right to property back in Portugal do not care to go through this legwork.
No idea about Lisbon but it was common in Brussels to let an old building "rot" to the point where the owner could destroy it and rebuild a new one. This way, they could build a bigger/better building and sell apartment at higher price than just fix the original building.
Demolition permit are hard to obtain but if your building is too decrepit, the city will force you to destroy it.
It used to be common, but then many cities got fed up of it, and now many municipalities have local laws to take ownership for the city if the owners behave this way.
-can't get permission to build due to massive amounts of red and green tape
-the only economically sensible option is to let the building fall into disrepair bad enough that the government lets you demolish
-governments close this "loophole" by seizing your property
and the problem is "the owners behave this way"? FMD.
It's entirely possible that there's non-loophole ways to solve this problem, but when a lot of money is at stake, why would landlords (or anyone else) make effort to be compliant with the spirit of the law, when they can cut corners, and abuse the letter of the law?
Well, the owners still have a couple of strikes before the city hall decides to fully take action.
I remember walking around nicer areas of Porto and Lisbon and seeing a perfectly regular house right next to a row of dilapidated, caved in buildings. Peering inside the cracked windows, I saw trees growing right in the middle of the home’s living area. It would commonly be one regular home for every 3-4 of those abandoned shacks.
In central Europe this is often done to bypass a Historic Bureau. Target of those guys is to preserve current "genus loci" of the city forcing owners to use traditional materials and processes to fix the building so outside it is still looking the same.
The loophole is that if building is too damaged, that there is no viable way to repair it, then it can be destroyed and new one can be built. So you can just let it be as is and wait you can help the decay by removing roof and let rain and cold do the work. Or in most extreme cases, just set it on fire "by accident".
(I've lived in Portugal more than 20 years ago and things (i.e. laws) might have changed significantly.) The problems with abandoned, degraded but historical/beautiful buildings had to do with several factors.
One factor was the social protection that renters (especially elderly) are afforded by law, especially keeping rents very (and I mean very low). This protection is in itself a good thing, but the downside was that landlords had no incentive to do renovations in the order of million euros for a building full of renters paying fifty euros per month each (I can't recall exact quantities). As I said, the protection of elderly is a good thing, but a balance was never achieved.
Another factor (and this ties with the bureaucracy theme) was that for some buildings, the state and municipality couldn't even locate the owner. So you might have this grade I building with a name as the legal owner, but it could be someone that emigrated to Brazil 50 years ago. Couple that with the slowness of judicial process and the building is in a limbo state for a century.
> What also chocked me when visiting Lisbon or Porto is the number of old abandoned buildings in what I would consider nice areas. I have always wondered what was the reason for that...
Likely property that is inherited to families that emigrated.
The article is way overblown and borderline clueless. First off, the Luddites demonstrating before the Web Summit had a political backing, they’re not a grassroots movement. That demonstration happened for the cameras (and to further a small party’s ambitions to the limelight).
Second, there is indeed backlash against the golden visa program, but the most meaningful bits are due to visas being granted to people who do zero actual investment in the country.
As to real estate, this is just the peak of a long crisis brought upon by idiotic zoning laws that favored high-value condos and villas, under pressure from a bunch of lobbyists from the building industry (we have at least two major cement lobbies here, each driven by its own influential family).
That, an emphasis on tourism and landlords’ resistance to maintaining or rebuilding existing buildings (partly due to inheritance laws, yes, but mostly driven by greed) has made it impossible to buy new flats in Lisbon even before “gentrification” from techies began.
(AirBnB is just another factor in this - a lot of those nice villas and flats are priced outside local affordances, and whoever buys them does so to rent out and drive a quick profit, since a lot of AirBnBs aren’t even taxed…)
The only thing the article gets right is that we have a completely bullshit legal and tax system that takes far too long for anyone to sort out - even natives. As an example, it is _much_ less sensible to work as a tech contractor here (unlike, say, the UK) because the fiscal load and legal protection are all stacked against you.
Even with “instant company” fast-tracking (which gives you a working legal entity in a few hours, provided you know where to apply to and how to do the paperwork), setting up a business and having official accounting requires some effort for a random Jane/Joe, especially if foreign.
But those barriers are fixable if you hire a local relocation/setup service, so real startups and savvy techies can breeze through those. The real trouble comes when you need to do contracts, pay taxes, etc. and there is a legal issue — courts here are slow, Byzantine and can take years to close a case, so brokerage (which can be fraught to navigate) is often the only option.
Anyway, the country isn’t broken because a few thousand crypto bros decided to settle in nice villas here. I know of several companies that are thriving here (hi Cloudflare!), even if there are constant paper cuts regarding bureaucracy.
Thanks for the super insightful post. Could you expand on what brokerage means in this context.
Legal mediation in which both parties agree to an outcome. Typically used for debts, property disputes, etc.
>Portugal sought to lure them with tax breaks [...] Portugal, then with no taxes on crypto-derived capital gains, fit the bill [...] “We have neighborhoods now that are mainly Airbnb,” said Ana, the Portuguese teacher, “We don’t have our homes anymore.” [...] locals protest against rising costs and gentrification
Surprised nobody saw gentrification and rising CoL coming when they invited crypto asset holders and workers who earn several times more than the locals while contributing much less in taxes.
Seems like a move that only benefited the Portuguese landlords and real estate owners at the expense of the rest of the population.
If I was a Portuguese citizen I'd be pissed at such a decision that prioritizes wealthy foreign crypto and tech bros over its own citizens and make sure to vote those politicians out.
Portugal is not Dubai. It can't afford to be a tax heaven with government revenue funded by oil instead of taxes. A country like Portugal should seek to attract businesses and investors who create jobs and pay taxes there, not attract wealth hoarders who dodge taxes and who's only contribution to the local economy is making landlords richer and buying cocktails on the beach.
>The center-right Moedas, for his part, said that while clarity on crypto and taxes is welcome, “when you start taxing innovation too soon, you can kill innovation. And so I'm not aligned with the government on this.”
Oh please, taxing crypto assets is not taxing innovation. WTF are you talking about? I feel like I'm taking crazy pills when I read stuff like this.
This would be no-problem if cities built more houses (especially large apartment blocks) ... well, and outlaw airbnb.
I live in a former socialist country that somehow managed to build A LOT of housing in the 70s and 80s, with shitty equipment, but somehow cannot build anything in the last few decades. And not just the government building stuff... normal people could buy a plot of land, get their friends to help, dig a hole and start building... a small loan for bricks and cement, and the basement + a concrete slab was built... then a month or two went buy, and what was left from the paychecks went for a pallet of bricks plus a few bags of cement, and half a floor was made. Repeat for a few years and a house was there... no insulation or a facade, but people could live inside and deal with that later. Papers and permits? As long as you built within some basic rules (far away from the property line and not a too unusual shape), you could basically ignore them, and deal with the "legalization" later. Now you're not allowed to build basically anywhere, papers cost more than the whole material+work did back then, and you're not allowed to do anything by yourself and your friends are not allowed to help anymore. So yeah... good luck.
>This would be no-problem if cities built more houses
"Just build more houses" is not something that scales infinitely. Long commute distances and geography tends to get in the way with stuff like hills, mountains, rivers, lakes, oceans, etc. while demand from foreigners and tourists will stay virtually infinite.
At which point do you stop building and say your city can't house more people without ruining the character that makes it a desirable city in the first place?
Should we level Lisbon's 2-4 story housing and turn it into a dystopian city with hundred story megablock towers like in Judge Dredd, just so that everyone in the world who wants to move to Lisbon has a place to live there? But then people won't want to live there anymore if Lisbon is just megablocks.
But in this case we are talking about replacing single-story buildings cities with multi-story apartments.
Just about every city has plenty of room to build lots of housing via upzoning.
> single-story buildings cities with multi-story apartments
How many single story buildings does Lisbon have? I don't remember seeing that many. And how many of those single stary buildings are not under UNESCO historical heritage protection laws and you are allowed to buldoze?
Lisbon is a large city, not everything is the historic "old" city center. You don't even need to demolish anything, since there is space around, and even if you do, there are a lot of not-historic areas there.
You don't need infinitely much, you just need a more than you have now.
We have vast areas here (Ljubljana, slovenia) where you're only allowed to build two-story two apartment buildings and nothing more.. and right next to those buildings are large socialist-time apartment buildings with many apartments. But nope, you're not allowed to build higher there. Even in rural areas, we have a lot of empty land, right next to the road, and nope, not allowed to build there, because people who built their houses now complain and don't want new houses there. They also complain if anyone wants to create any kind of business there, and then they complain that there are no jobs there, and that people have to drive to the capital.
Look at eg. sillicon valley for example... just building 3, 4, 5 story apartment buildings in areas where there are single-family houses would multiply the usable area for apartments by 5 times, making the buildings larger (combining multiple plots) even a lot more, and since the number of apartments goes up, there is much more potential for investors to offer above-market rates for those plots of land where they could build bigger and higher.
>You don't need infinitely much, you just need a more than you have now.
How long do you think "a little bit more than you have now" will last until housing stops being sufficient again and you're back to square one?
Cities like Lisbon have virtually infinite demand due to how attractive they are and how many people would like to live thre, so yeah, you would technically need infinite housing to satisfy the never ending demand, unless you take some legislative policies the makes Lisbon less attractive for certain foreigners and tourists wanting to come there.
> Cities like Lisbon have virtually infinite demand due to how attractive they are and how many people would like to live thre, so yeah, you would technically need infinite housing
Well obviously "infinite" is not true since there are limited people on earth with mobility to visit Lisbon, and not everyone would want to visit, and not everyone can do it at once...
But in good-faith arguments, there is a lot of difference between "build on an empty lot" and "turn Lisbon into Manhattan". As others have pointed out, there are a lot of crumbing buildings in Lisbon. You don't need "more" forever, you need "more" until demand is satisfied or supply of buildable area is exhausted (which it is not).
Also, there are areas on the edge of lisbon, that could become a new manhattan there.
Look at Belgrade for example... after the war, when the city was "full", the communists decided to build more, took an empty swampy area across the sava river, and started building... A LOT:
before: https://www.4zida.rs/blog/wp-content/uploads/2016/02/novi-be...
After (a tiny part): https://upload.wikimedia.org/wikipedia/commons/thumb/0/05/Be...
I live in slovenia, and similar projects were built here, and A LOT of them... somehow all the building stopped after we gained independence.
Tourists belong in hotels not in residential area apartments. Foreigners should not be able to own apartments at all, since it's a limited resource. Otherwise, build until the prices drop to some managable level for normal people.
If your argument implies a slippery slope into a fictional dystopia, you just may be exaggerating just a weee bit.
Wasn’t this called “wild building” for more reasons than just lack of permits?
As a portuguese it blows my mind that "digital nomads" are choosing the country to live in. Surely the country has great weather, food and you get an hefty tax discount that the natives can only dream about (20% of income tax is wayyy lower than a living wage in this country pays). But if you investigated a bit more you would see that the emigration rates of the country are going through the roof.
It should be a huge red flag that one "nice" country has more than 20% of it's population living abroad: https://poligrafo.sapo.pt/fact-check/cotrim-de-figueiredo-po... (you might want to use Google Translate on this one).
I also saw some comments blaming the tourism for this "bubble" bursting. The portuguese can't complain about tourism since it's a huge part of our PIB.
> Surely the country has great weather, food and you get an hefty tax discount
Sounds like you have it figured out why people are moving there :)
I think it's always hard for natives to figure out why people want to move to their country, where they see mostly problems and not how much better it is than where the people come from.
I'm an immigrant as well, and wouldn't understand why people would move to the country I was born in, but people who are from the place I currently live in feels the same way but vice-versa.
Good weather and good food is surprisingly convincing, at least for me, in deciding where to live.
And if you come living here with a foreign wage, sure makes sense to me. But if you have a "native wage", it's a no go.
Even with a salary from a Portuguese company, the cost of living is relatively low (compared to other South/Western European countries, and not including Lisbon obviously as it's a outlier [like all metropolitan areas]) so makes sense even with a "native wage". Especially if you work in the IT industry.
The cost of living is not low at all. Don't know where you got that idea from.
Of course it depends on what you compare it to. But compared to its South-Western European sisters, it is quite low. Mainly getting it from living in a bunch of European countries (including Portugal, and others outside of Europe, but not as relevant).
Besides Lisbon (and probably Porto nowadays), it's hard to find a place with good weather, good food and low cost of living compared to Portugal. Or maybe you have some counter-examples you care to show me?
In order to add some facts to the discussion, here are two links showing some comparison between cost of living in different countries in Europe:
- https://www.theglobaleconomy.com/rankings/cost_of_living_wb/...
- https://www.numbeo.com/cost-of-living/rankings_by_country.js...
Probably other portuguese are going to hate me for saying this but... you have Spain. Their cost of living is a bit higher but their wages are higher as well and in some key stuff they have cheaper stuff than us. I went to Barcelona last year and I actually purchased there stuff to bring to Portugal because it was cheaper.
Also, I get why people get the idea that Portugal is "cheaper". Most come here in a trip, eat at a restaurant and pay a lot less than they're used to and they think the country is cheap. Well, that only happens because the wages are very low (our minimum wage for 2023 is 740€ and even though it raised a bit, the remaining wages aren't raising accordingly).
From personal experience cost of living in portugal is in line with germany.
I'm not sure Germany is famous for its good weather nor good food, but I've only visited a couple of times, never lived there, maybe I missed out on something obvious?
Please enlighten us. Why are 20% living abroad? What are they running from?
Wages are very low considering the cost of life here. Rents in the main cities of the country are going through the roof and there's little to no choice (if you're a digital nomad you can always choose to live in other areas, since it's clear you don't need to live close to where you work, but the issue there isn't much better).
About 26% people are living abroad (emigrated) and many of the ones who are staying in the country end up working for portuguese companies who mostly also work abroad.
So, if those people fled a country with such great good, weather and specially their families, it should ring some red flags no?
Digital nomads are probably not working for local wages. So those bad things are irrelevant for them.
It’s ridiculous to blame digital nomads. If there is a primary source to blame, it would be Airbnb.
This gentrification and tourist problem began well before Lisbon became a DN favorite.
Also it’s a global problem as wealth accumulation means individuals and companies can’t find enough places to “safely” put cash. Real estate, especially when it can generate good income, is an obvious choice.
Plus, Portugal attracts wealthy Brazilians who want a comfortable, safe, and European home.
If Airbnb is the problem then just sounds like supply is out of whack with demand. Sounds like they ought to be building more homes and transport infrastructure to cope with the demand. Though based on other comments also sounds like it’s not the most competent local government.
It's not so simple. For one thing, it's a very old city that is already full of buildings. Unless you want to raze buildings and rebuild (the most extreme form of gentrification, and also the way to ruin the historical charm), there's really not place to build new housing. You have to go quite some distance from the city center to find space. And then you need a lot of new transportation infrastructure to make it attractive/possible to get from the new available housing to the city center.
And just as it is difficult to build more housing in an already full city, upgrading or building new transportation infrastructure is very difficult and costly (and disruptive for years to the people currently living there).
There's really little that can be done to balance things. When "everyone" decides that Lisbon is cool (and it is!), they all want to visit. So naturally any apartment or building owner who can convert from local long term rentals to tourist short term rentals (at many X the price) will just based on the profit potential.
And when property companies realized this, they began buying whatever they could - both as a good long term investment in the real estate itself, and for pretty great tourist income.
Many places in the US and elsewhere in the world have the same problem.
That’s all fine and good but if old established cities—which by definition are desirable else they wouldn’t be so established—just cannot change like you’re describing, then they’re doomed no matter what. Never said it’s simple, just stating a fact, and even if some people don’t like it then they have to choose what they value more. Seems like most of these cities just refuse to choose, which is a choice in itself, and then default to the status quo.
Personally if you don’t want to change the physical form of the city too much, the least disruptive approach is to build a lot of efficient transit towards the outskirts. It’s what Tokyo does and it scales to 40m people mostly living in low rise homes, no out of place towers necessary.
Lots of Goan friends have finally opted for that "ancestral" Portuguese passport and none of them have any intention of either working or staying in Portugal ever.
Why would you not get a free EU passport if you could?
Well, I wasn’t saying they should not. I was just pointing that out - kind of being in sync with what the post is pointing to.
As for not getting EU passport even if you could get that for free, there are too many very common and valid reasons to be listed here. And in fact there are other Goan acquaintances who didn’t want to. So let’s leave it at that.
One reason could be that Goa has the highest GDP per capita among Indian states and Goans are the richest among Indians. Goa is famous for its Susegad lifestyle and there is relative prosperity in Goa that's not usually present in other regions. However the Goans who leave shores head to UK skipping Portugal altogether.
> Critics “have to understand there is not a dichotomy” between drawing in outsiders and caring for locals.
Can confirm, I’ve stayed longer than short term in many cities and am a transplant in all cities. Some places handle it better than others, every place points fingers at a the nearest most visible externality. What they all hardly consider:
- their neighbor could have set the rent super high at any point in history, and didnt gamble on doing that then and didnt have to gamble on doing that now. the rent doesnt have to be that high and you can likely peer pressure them into not raising it to its highest acceptable threshold
- I dont care what the rent is anywhere, more on this later
- anyone that can afford the current rent, set unilaterally by a gambling landlord, is usually paying more than everyone else
- and circling back, any unit in any city would satisfy me, so even if I would pay $6,000 in Miami and thats super high, the $1500 place in Austin would remove me from the market, even though thats high to people in Austin (example, I dont actually know, or care)
- all together this puts it more so on the gambling landlords in all places, yes there are some tenants that ask for higher rent just to skip the application queue but I would need that quantified
Two+ years in Algarve, with registered activity and paying all the taxes here. Having foreign income all my taxes fall within sweet NHR regime. Can't say anything bad about bureaucracy, with proper lawyer help it is slow-ish but very decent process.
Lease prices are driven by taxes and tourism, short term (AL) accommodation is taxed at 6%, long term lease contracts go from 30% (for 1+ year contracts) down to 10% (for 10+ years contracts). Obviously landlords are pushed into short term accommodation which creates lack of long term offers. Matter of getting taxes more fair over long/short term categories would fix the market immediately.
Quality of life and nice people are above anything else so I wouldn't change a thing from this current setup.
I wonder how many came via Pieter Levels https://rebase.co (online immigration service)
I know about this website as well. Pieter is a smart and maverick businessman and he simply jumped onto the opportunity when he saw one.
I was just in Lisbon yesterday. I recommend the Lisbon Winery for a lesson in port wine and great food. It’s a nice city, the level of English is high, but it’s not as modern as other European cities. Plus, who wants a horde of cryptobros anyway? What “innovative” about tulipomaniacs?
As for Airbnb, that’s the same is most touristy cities and it’s not just because of nomads.
> As for Airbnb, that’s the same is most touristy cities and it’s not just because of nomads.
Cities should be for citizens... tourists belong in hotels.
What if the citizens want to make an extra buck renting their property?
The idea we were sold: Rent your spare room, Rent out your whole place while you're away.
The reality: Capital-rich folks buy up properties purely to run AirBNBs.
Almost all of the benefits go to the owners.
Almost all of the downsides go to the neighbours, suburbs and others who are competing to rent/own there.
There's a difference between (long-term) renting and airbnb.
Just ask the neighbours, who normally don't care about long-term renters and complain a lot about ever-changing tourists and all the issues that brings (from safety to loud parties).
You cannot have a factory in the middle of a residential zone, why can you have (what is effectively a single room) hotel?
I lived from 2014 to 2016 in a really cosy flat with a sloped ceiling in downtown Lisbon. I literally moved away from there solely because the unit beneath mine turned into an AirBnb rental and there were constant loud parties all night long pretty much every other day. Not to mention people leaving the building door open, the rapid degradation of the stairwell with all the tourists dragging their suitcases (and the fact that the parties often extended to the stairwell).
The problem is when housing prices are at an all time high and it's almost impossible to find somewhere to rent, even with money in your pocket, because the landlord decided it's much more profitable to do weekly air-bnbs to tourists.
> The problem is when housing prices are at an all time high and it's almost impossible to find somewhere to rent, even with money in your pocket (...)
I have to call bullshit on this one. A few years ago I moved to a different country and I had an awful time trying to find an apartment to rent. Between awfully expensive flats and squalors, I was forced to extend my stay at an hotel for an additional month. This all ended when I managed to land a flat in a airbnb-like service. It was cheaper than half the apartments I visited at the time, and right in the city center. I spent over a month in that apartment and eventually landed a decent long-term rental, but if it wasn't for the airbnb-like service either I would be forced to burn through cash to stay at hotels or settle with being exploited by abusive landlords. Midway through I even considered just sticking with the airbnb-like service even though I'd risk being out-booked.
Perhaps people like you could spend a minute thinking things through and consider why there is demand for offers somewhere between hotels and long-term rentals, which frequently are completely out of reach of those who have to move to a new city in a short notice.
There would be a lot more long-term rentals available if there was no airbnb (because airbnb is the reason that you were unable to find a long-er term rental in the first place).
Limit the rentals to 1 month (or 2) minimum and you have all the bases covered.
How come in so many markets suppliers seek the demand and glad to have it, but in real estate market instead of cheerfully increasing the supply there are complaints, proposal to limit and in general offers to do something unusual where the goal could seemingly be achieved by more housing...
Because one of the greatest cons of the last ~50 years has been convincing the middle class that housing is an asset, so now the price level in most Western cities has been bid up to insane levels, and asset owners will do whatever they can to maintain the value of their "asset".
Also because real estate may resemble a market but it's very far from a free market, with lobby groups, regulations and intervention everywhere you look.
Because the "investors" buy up property and then lobby their (local or national) governments not to allow more housing to be built to artificially inflate the prices.
> airbnb is the reason that you were unable to find a long-er term rental in the first place).
No, the reason for that is that demand exceeds supply. The reason demand exceeds supply is that voters don’t want more people living there. Democracy gives the people what they want, good and hard.
> Perhaps people like you could spend a minute thinking things through and consider why there is demand for offers somewhere between hotels and long-term rentals, which frequently are completely out of reach of those who have to move to a new city in a short notice.
Like a lot of HN, many people have lots of opinions on things they have neither done or have experienced first hand but seem to be most vocal on such matters.
Agreed, I don't blame Airbnb or it's counterparts in other countries, they are just capitalizing on the larger (systemic but ultimately manufactured) housing crisis because the greater issue is with making real estate holdings the only way to accrue or retain any wealth as more and more of the real economy gets hallowed out.
I personally leveraged my first Airbnb stay as an early adopter and did what they say 'you should never do' and ultimately cut them out as a needless middle man and made return trips for several years without them in the off-season and got an even better rate!
Alternatively, I've paid rental agencies who did nothing but list their property on their website and provided a day to see the place and not much else as I met with the owner's myself had to find translation solutions and ultimately saw how they added just as much if not less value than Airbnb in the over all process of finding a rental home/apartment and saw that it's a symptom not the cause of the malaise we see since 2008 crisis and perhaps even before in the dotcom bubble in 2000 that made 2008 inevitable.
People want an easy scapegoat, and while I agree real-estate and landlords are predatory by design I still don't think Airbnb is to blame here and I don't even think they are a 'good' business, in fact I stopped using them entirely despite being an early adopter, but they've used their platform to house more people in certain crisis' than even some nation-states have.
> Why there is demand for offers somewhere between hotels and long-term rentals, which frequently are completely out of reach of those who have to move to a new city in a short notice.
You see that's the problem, I'm not in the US or Europe, long-term rentals are traded in local currency, in a price reasonable to the local economy, whereas AirBnbs are traded in USD at a more global price reasonable for tourists (which is crazy expensive for us, considering our minimum wage is pennies in USD).
Moreover, long-term rentals have certain regulations that favor tenants, like, you can't raise the prices a massive amount compared to inflation while the contract is valid, etc. AirBnbs are not regulated.
There is a reason to have tourists in hotels beyond government control and taxation. But not everything in life has to be centered around a desire to profit.
Usage patterns and resource usage of residents and tourists are not equal. Tourists tend to need less space (since they just sleep there) and tend to be noisier (since they don't usually have a worker's schedule, and/or may be loud while vacationing). They tend to have different transit usage from locals, and they tend to travel to different parts of the city. All of this causes un-even wear on the resources and infrastructure within the city.
It's impossible to pay rent in Lisbon while earning median salary as one person (855€ average rent for 1 bedroom apartment vs 1200€ median salary).
At this point, there's no reason for anyone new to go live there.
My partner and I moved to Lisbon about 6 years ago. We lasted 3 months after it became clear that the rent was more expensive than what we had just been paying in Sydney.
I love how this HN thread immediately turned against tourists and ignored the impact of the cryptobros.
There are a lot of tourists, and a comparatively tiny number of "crypto bros".
When it comes to shit like Airbnb, etc, in cities such as Lisbon, the "crypto bros" are less than a fraction of a percent.
Simple, tax their short term Airbnb rental side hustle until they have second thoughts about this and maybe then they rent it instead to a long term tenant who actually needs it like a local student or worker.
The main aspect of Airbnb being attractive in Portugal is that rental laws are very biased to tenants. It is quite literally almost impossible to evict. Also in general civil court cases are backlogged for years.
Airbnb will probably feel like neo-liberal haven for these landlords.
Yeah, affordable living only for the Portuguese that have to find housing on the outskirts and drive one hour to work, because naturally our public transport network isn't that great anyway.
Thankfully I got my housing situation clarifyied several years ago.
Yeah one thing I have learnt in my adventures is that you should never try to do business in a non advanced economy. I keep all my business in the Netherlands no matter where I live.
Is this purely a Lisbon thing, or has it exploded over the last 6 months? I visited Porto last spring and there weren't any crowds nor many foreigners, it was pretty quiet.
It's being blown out of proportion for click-bait reasons. The journalist and the people he interviewed are delusional too (ability of Portugal to tax). There is churn even with the tax rebates because of how bad portgual is. This thing would not work with taxes or expensive prices/real-estate.
Nomadism is ephemeral. The bubble will pop as soon as the new hottest place comes into the picture.
It is everywhere, in all major cities, Porto, Coimbra, Braga,...
This year quite a few thousand university students had to give up their place, because they could not find affordable housing.
There’s a comment somewhere about colonialism of the past and irony in this thread but I haven’t found it yet
I wouldn’t say Lisbon is an ideal city to settle down in.
https://www.air-worldwide.com/publications/air-currents/from...
You should read the article to the end. We get multiple small (i.e., hardly felt) quakes throughout the year that point to a steady release in pressure in the fault.
Portugal is heavily bureaucratic and centralized in Lisbon
Fire/reduce public servants and spread them away from Lisbon, there, solved!
sources:
"highest increase in jobs can be seen in central administration"
https://www.portugalresident.com/number-of-public-sector-wor...
https://ec.europa.eu/social/BlobServlet?docId=19963&langId=e...
76% centralized government https://op.europa.eu/en/publication-detail/-/publication/b9b...
Not advocating for the influx of "crypto bros" and "digital nomads" but to blame the current wave of inflation on them is a bit ridiculous
> Not advocating for the influx of "crypto bros" and "digital nomads" but to blame the current wave of inflation on them is a bit ridiculous
Good, because this article is about neither but easy to deflect if all you look at is the title; its mostly about the affluent and those who could work remotely (not entirely nomadic as they were already EU citizens) who took advantage of this scheme, here are the most important takeaways that support that it's scope goes beyond either for the issues seen now on PT:
> Belgian entrepreneur Jan Deruyck, who moved to Portugal in 2021 with his wife Morgane to build feminine health startup Guud in “full isolation” during the pandemic, is one of them. But a year and a half later, he’s out: “[They have] huge ambitions, but there’s little execution.”
> Thank the Web Summit for the visas' shift toward tech workers: It’s “one of the reasons why Lisbon got on the map of Silicon Valley entrepreneurs,” said Armand Arton, founder of the Global Citizen Forum, a members’ club for well-heeled cosmopolites. “Then COVID happened and we started getting calls from wealthy American families saying they wanted a residence permit to enter Europe at any time [regardless of travel restriction]. They got golden visas by investing in technology companies.”
> Not to be left out, EU citizens also flocked into Portugal to work remotely during the pandemic, taking advantage of a “non-habitual resident” tax regime that exempts foreign income from taxation and charges a flat 20 percent rate on Portugal-generated revenue from high-value professional activities. Managing a company or working in the technology field can qualify for such activities, making the scheme attractive to digital nomads.
I'm a DN and came over during COVID, in the onset PT was on my list, but after the headache I had to deal with the HR government and the sheer incompetence and abject failure to do even basic functions, I realized PT was the same but with the added headache of competing with a much broader scope of people and the longer backorders and growing wait list, the processing time went from 6 months to a year plus for approval because of the influx.
Furthermore, the main cities soon started to look like a common tourist traps and all that follows because of the crowds who came over which was one of the reasons I wanted to get out of the US in the first place and ultimately made the decision for me.
I'm not surprised locals are pissed, they should be: but they should primarily direct their anger toward their government that because of failed policy, poor economic and investment strategies have made the decades long brain-drain in PT necessary, and in turned hollowed out their entire economy in the process which led to the typical housing and property speculation and consolidation from foreign investment as big as it is, and golden visa schemes the only thing monetarily viable in their country other than tourism.
The truth is that Portugal, despite being geographically the most Western of all nations in the EU, is pretty much on par with it's E. European counterparts (made up of former Soviet satellites or fragmented Republics of Yugoslavia) economically, socially and politically so; Digital nomad visas didn't do that, it just made it more accessible in what is actually just a glimpse of what is to come: as the Global population starts to recede (gradually and then suddenly) from it's 8 billion high as more boomer start to die the unfunded liabilities within the system will have already bled it dry in pensions and medical costs and the only thing left will be to compete for citizens with favorable status--Portugal didn't just offer a DN a tax free temporary residence, but full fledged EU citizenship within 5 years with some caveats. It was essentially a longer path toward the Golden Visa that is only offered to those wealthy enough to buy-in their way into passport hunting.
Just for context, even Germany (the most non-PIIGS nation) is struggling to keep the hospitals running [0] because of the staff shortages after COVID, and even keeping up with supplies is suffering due to the supply shortages and over-dependence on imported made drugs and devices in a mainly manufacturing country is staggering, and it has been made worse since the invasion in Ukraine due to the cost hikes on everything.
I certainly hope so.
Same. Digital nomads, leave, go away. They have a negative impact on the economy.
"digital nomad"
how is that a thing, as a society we keep reaching new lows year after year, this is very concerning
"repeating past mistakes is our motto"