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Comment by neither_color | Hacker News Reader

The number of Americans residing in Portugal is at its highest level in more than a decade, according to agency data. There were about 7,000 Americans living in the country at the end of 2021, more than double three years earlier.

source: https://www.cnbc.com/2022/06/14/a-cool-destination-to-just-s...

Sincere question: Does anyone know how to differentiate between rise in real estate caused by a couple thousand Americans in a country of millions and the general inflation and rise in real estate being felt everywhere? I'm not fully convinced that a few thousand foreigners "ruined" Portugal, CDMX, and other such places. This seems more like a classic case of blame the foreigners, not our policies nationalism. The average digital nomad cannot afford to buy houses for cash in Europe.

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Real estate is priced at the margins, because it's rather illiquid. Here's an estimate, there are about 10M people living in Portugal, maybe 5M living in areas (cities, coasts) where wealthy foreigners might want to settle. Average 3 people per household, that's 1.6M homes. Housing vacancy rates in desirable areas are usually 1-3%, so maybe 15-45k available homes at any given time in desirable areas. An influx of a few thousand extra wealthy people (say 3-5k, not just Americans) in a short period of time could certainly have an impact on current vacant housing prices, which might last a good number of years (prices tend to go up quickly, and down slowly).

A much more significant causal factor is probably the aggressive devaluation of other monetized (in the sense of serving-as-(ersatz-)money) assets like equities and national currencies. Real estate is one of the only good investments when governments are doing crazy stuff like shutting down the economy and writing big checks to stay at home.

The big blind spot is urbanization, which is ongoing. Internal migration is the vast majority of the numbers.

Of course they are less wealthy - almost by definition - than the foreigners who take a lot of apartments.

I don't particularly care about Airbnbs, but the general problem of underbuilding (in cities proper) is enormous and most people don't even acknowledge it. :|

Presumably demand also has some elasticity. There may be a set number of bedrooms, but if prices go up enough, more people make roommates work, forgo the guest bedroom, or sleep more children to a room.

This is a real factor, and it’s good that it prevents people from ending up homeless. However, making lifestyle changes like this definitely stings hard enough to make people angry at the foreigners.

> caused by a couple thousand Americans in a country of millions

Chinese nationals account for half of all golden visas issued in Portugal. It is the same capital outflow that is ruining real estate markets worldwide.

https://www.bloomberg.com/news/articles/2023-02-16/portugal-...

That article also says the total number of residency permits issued under the program was 11,628. The idea that 12k foreigners have caused (or even significantly contributed to) Portugal's housing unaffordability doesn't really pass the smell test.

Picking on the portion of those that went to Chinese nationals is just an irrelevant detail.

It’s pretty easy. Short term rentals and big money rentals displace limited inventory and drive markets up.

It’s a phenomenon seen time and time again with AirBnb and to be honest is the way the US government eliminated SROs and tenaments without windows etc. Section 8 vouchers drove up rents for conformant apartments.

I have a suspicion the real issue is tourism and not expat residents. It’s driving up rent in downtown Lisbon.

How so?

I would imagine via AirBnB or short term rentals in general. Last time I stayed in Lisbon I stayed in a converted apartment, via AirBnB. It certainly puts pressure on the long term rental market.

The decrease in the typical duration of tourists' stays in Portugal, which has gone from 6.7 days to 4 days in the past decade, is likely to affect various aspects of the country's tourism infrastructure, including its airports. Additionally, there has been a problem with noise pollution in residential areas due to touristic establishments like bars and nightclubs.

Indeed. It's AirBnB.

I also have a sneaky suspicion that some/perhaps many Portuguese are actually doing pretty well, and are thus collectively suffering the same 'affluenza', stoked by zero interest rates, as the rest of us.

I would imagine by residing they are only counting people who are renting long term. Then there are also those who stay for few months which would mean lot of AirBnB or similar rentals. That would outprice locals.

> by a couple thousand Americans [...] I'm not fully convinced that a few thousand foreigners "ruined" Portugal

Me neither.

However, There's probably a lot more EU residents living part-time in Portugal than there are Americans. This most likely has a much bigger influence than a few American expats.

Let's also remember that Portugal (and Spain) were dictatorships not that long ago which would have severely crippled foreign investments. Their economies are nowhere where they would be had they been stable democracies but are on the right direction playing catch-up with the rest of Europe. Poland and Romania are on a similar trajectory after having their development and growth stunted by decades of communism.

Lol, 7,000, that's literally a roundibg error. Perhaps it was cancelled because of such low demand.

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