Young Portuguese are putting dreams on hold because of the housing crisis.

LISSABON, March 21 (Reuters) - When Maria Lopes moved to Lisbon from the northern Portuguese city of Tondela, her goals were simple: study, get a job, get her own place. But a decade later, she still lives in a tiny rented room - one of tens of thousands of young Portuguese affected by a housing crisis exacerbated by the arrival of wealthy foreigners attracted by incentives created by her own government.

These incentives, including golden visa programs for wealthy entrepreneurs, have received much praise for attracting the investment that helped pull Portugal out of the 2011-2014 debt crisis. But critics say the programs have come back like a boomerang and are hurting the economy by increasing competition for limited housing, leading to inflation and putting particular pressure on young, low-income local workers.

"I want to live... I don't want to just survive," Lopez said after working for a tour bus company. This 30-year-old with two degrees in tourism rents an apartment with five other people, pays 450 euros ($475) a month for a 13-square-meter room, but earns just 800 euros a month during the low tourist season.

"I hope all this noise and disturbance we are creating will make a difference," she said, referring to the wave of discontent - protests, marches and petitions initiated mostly by young people who are having trouble paying their bills.

City with financial inability

The cost of living is rising around the world. But it is the stark contrast between winners and losers that sets Portugal apart from its European counterparts.

Portugal is one of the poorest countries in Western Europe. But its capital was ranked the third most financially impossible city in the world last year thanks to a combination of low wages and high rents.

Since 2015, Lisbon has seen an influx of Airbnb apartments and new hotels, foreigners investing in real estate, and investment funds buying entire buildings.

"Lisbon has become 'trendy,'" said housing expert Gonçalo Antunes of New University. "The real estate market developed without any control. "

Housing prices and rents are on the rise.

Rent rents in Lisbon have risen by 65% since 2015, while sale prices have increased by 137%, data from Confidencial Imobiliario, an agency that collects information on housing, shows. Rents rose 37% last year alone, more than in Barcelona or Paris, according to Casafari, another real estate company.

Local residents are struggling to cope in a country where public housing makes up just 2% of the real estate market, according to government data.

Antunesh said the situation is particularly difficult for young people. The monthly minimum wage in Portugal is 760 euros ($801.27), and about 65% of young people under 30 earned less than 1,000 euros a month last year, according to Labor Ministry data.

"Some people don't eat to pay the rent... there are some really tragic cases," said Luis Mendes, a housing researcher and geographer at the University of Lisbon.

Evictions and young people

The number of evictions is also on the rise, up 13% in Lisbon last year compared to 2019 before the pandemic, according to government figures.

Young mother Dulce Dengue, originally from Angola, was evicted with her children and nephews from a poor neighborhood on the outskirts of Lisbon in 2021. They moved from hostel to hostel before finding a home away from the city in Setubal, about 50 kilometers south of Lisbon. Going back to the city was "impossible," she said.

Someone is leaving town. Some stay with their parents. The average age at which people leave their parents' home in Portugal is 33.6, the highest in the European Union, according to the bloc's statistics office.

"It reaches a point in our lives when we lose hope," said Vitor David, a 26-year-old computer programmer who rents in Almada, on the other side of the Tagus River, where costs are slightly lower.

Government measures and criticism

Mendes said the recent housing package announced by the Socialist government contained "bold measures" but would not bring prices down anytime soon. As part of the package, new licenses for short-term rentals, such as those through Airbnb, will be banned - except in less populated rural areas.

Rights groups are pointing the finger at 'golden visas' that the government has promised to abolish. The program has granted foreign nationals residency rights since 2012 in exchange for investment, attracting 6.8 billion euros, mostly in real estate.

The new "digital nomad" visa, which allows foreign remote workers earning four times the minimum wage to reside in Portugal for a year without tax on external income, has also been widely criticized.

But even some of these remote workers are becoming increasingly aware of the housing crisis. Esme, a 28-year-old from the Netherlands, lives in the coastal town of Costa da Caparica, on the other side of the Tagus, and pays 825 euros a month for an apartment.

"Even for me - having an income from another country - that's a lot of money," Esmi said. "If housing stays this expensive or worsens, (foreign) people earning Portuguese wages ... will start returning to their home countries."