Housing shortages impact Portugal and Cyprus as supply measures face challenges

European nations are facing significant housing shortages characterized by rising rents and a lack of affordable options. In Portugal, estimates suggest a deficit of over 300,000 homes has accumulated since 2014. Experts suggest addressing the crisis requires not only new construction but also the rehabilitation of existing empty or underused buildings.

In Cyprus, the Ministry of Interior is implementing a two-pillar strategy to increase housing supply and improve purchasing power. One key initiative, the Renovate-Rent scheme, aims to bring 1,000 residential units back to the rental market through a €25 million budget. However, the program has struggled to gain momentum, with only 86 applications submitted to date.

Challenges for the Cyprus scheme include the requirement for owners to rent properties at 70% of market rates for four years and the financial burden of upfront renovation costs. Additionally, some property owners find it more profitable to rent to groups of foreign workers at higher per-person rates rather than participating in government-subsidized programs.