Households and housing in Lisbon: current and future needs

Knowledge about population and households’ future trends, namely the distribution of households by size, is highly relevant to the formulation of public policies due to its impact on many fields: housing development, public services, social assistance, environmental management, among others. Housing development requires informed planning because it involves large investments, construction or rehabilitation can take several years and the build-out will last for many decades.

Over the last decade, adequate and affordable housing has become an important concern in Lisbon, as in many other European cities. In Lisbon, the approved construction projects since the 1980s, have completely ignored the demographic trends, resulting in several mismatches with its housing stock, mainly a surplus of dwellings for the number of households and an oversupply of large dwellings for the average household size (Garha and Azevedo 2021). According to the 2021 Census data, the number of housing units in Lisbon is 24.1% higher than the number of households. Despite this apparent housing surplus, the lack of adequate size dwellings (small) and steady increases in prices, over the last decade, made access to housing in Lisbon tremendously difficult.

In this paper, we look at housing needs created solely by demographic trends. First, based on census data, we use the cohort component method to obtain the resident population until 2050 and their structure by age under certain hypotheses about the future of mortality, fertility and migration. Then, using recent advances in modelling household distribution by size to develop household projections, we identify the upcoming housing needs in the coming three decades. Our results will allow policy makers to make more informed decisions on urban planning, namely on private buildings permits, and regarding the public investment in the provision of services and in the public housing sector.