According to a recent analysis by Nestpick.com, the largest aggregator of furnished apartments for medium and long term rentals, in Portugal you have to work more and more hours to pay rent, taking into account that the increase in wages has not kept pace the rise in rental costs.
According to this home search platform, which aggregates the offer of houses advertised on the main rental web pages, and has more than one million properties listed worldwide, the average price of housing in Portugal has risen noticeably in the last year, being increasing the share of wages needed to pay rent in the main Portuguese cities.
Taking as a reference the average monthly cost of renting a furnished 1 bedroom apartment, the cities that recorded the greatest increases in the period between January 2019 and January 2020 were Coimbra, with an increase of 83% and where the value went from an average from 410 euros to 750 euros, and Porto, with an increase of 82.5%, where the average cost reached 1,440 euros in January this year. Lisbon was the only city that did not register an increase, with an average rent costing around 1,300 euros.
According to the figures from Nestpick, the increase in rents in Coimbra and Porto are well above that registered in large European cities, such as Paris (40%), Madrid (38.5%), London (16%) and 3, 8% in Berlin, a city with one of the lowest rates of self-housing in Europe and where authorities have recently taken steps to freeze rising rent prices and stem the growing shortage of affordable housing.
Based on the average value of rents for furnished apartments with 1 bedroom, of the cities analyzed the most expensive is London with 2,625 euros per month, followed by Paris, 2,345 euros, Madrid with rents of around 1,700 and finally Berlin whose value of 1,470 euros is very close to the 1,300 euros in Lisbon.
The reality of disposable incomes and the cost of living are creating an obstacle for businesses and cities struggling to attract highly qualified labor. According to the National Statistics Institute, in 2019 the average gross salary in Portugal reached 1,276 euros, growing 2.7%, but still almost 64% below the European average of 2091 gross euros per month, according to the VII Monitor Adecco’s Annual Salary Report. The difference between Portugal and Germany, for example, is 1,518 euros per month, that is, a worker in Portugal has to work, on average, more than 26 months to have similar income to that of a German worker, in just one year.
The short difference between the average cost of rent in Lisbon and Berlin (13%), means that a worker in Lisbon has to work many more hours per month to be able to pay a rental compared to a worker in Berlin.
“The rental price in Portugal has been rising year after year and the analysis of the data we have from 2019 highlights that this trend shows no signs of slowing down, at least in the short term”, said Ömer Kucukdere, founder and CEO of Nestpick. “While this may be good news for homeowners, it is also an indication of how difficult it is today and in the near future for students and young workers to find a place to live in the city at a reasonable cost. Our commitment is to offer a simple and free platform that allows them to search, compare and choose a house to rent that best fits their resources.