Air tourism boom fuels housing crisis on Mediterranean islands

The surge in low-cost air travel to Mediterranean destinations is reshaping the housing market across Southern Europe, according to a study commissioned by Transport & Environment and published by the New Economics Foundation this week. The analysis found that popular tourist destinations including Spain, Portugal, Italy and Greece face average annual rent hikes of up to €250 driven by tourism-related demand, with some of the most visited regions experiencing far steeper increases.

Sardinia, among Europe's most sought-after summer destinations, sits at the centre of this pressure. The island's Costa Smeralda and other coastal zones have long attracted international visitors, but the democratisation of air travel has transformed seasonal tourism into a year-round housing competition. Foreign buyers and holiday-rental operators now bid against local residents for scarce accommodation, particularly in towns within reach of Cagliari airport and the northern coast.

The study notes that residents in high-season summer months have protested the strain on affordable housing across the region. What distinguishes the current crisis from earlier tourism cycles is velocity: the combination of cheap flights, online booking platforms and the post-pandemic shift toward remote work has compressed decades of gradual migration into a few years. Local wages in Sardinia have not risen proportionally, leaving young islanders priced out of their own communities.