Digital Nomads Spark Housing Crisis In Mexico City

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Mexico City is making bold moves to address the mounting issues of gentrification, skyrocketing rent through the stratosphere, and an invasion of digital nomads, whose presence is changing the face of select neighborhoods in the capital. As the cost of housing skyrockets in many neighborhoods throughout the world and local culture vanishes, Mexico City’s mayor, Clara Brugada, has announced an ambitious plan to help address the shift.

The initiative, which followed massive protests by Mexico City residents (chilangos) earlier this month, hopes to promote a more equitable and sustainable housing sector. The protests were driven by the locals displaced by the increased spending power of foreigners, especially digital nomads who rushed to Mexico City after the pandemic because of the low cost of living and looser restrictions.

“This is an issue of justice,” Mayor Brugada said in a statement to local media. “We need the people who are living in Mexico City to stay in Mexico City. There have been unreasonable rent increases, particularly in some areas, that have been out of balance, and we need to have public policies that take some of the pressure off.”

The proposal of Brugada is a complex strategy. First, to ensure control over the excessive rental price that landlords have been charging in the most gentrified places. Also, under the plan, a list of rental proposals would be published and would ostensibly provide a means to make sure that local people can still afford to rent. The city is aiming to halt the financial squeeze on its residents, many of whom can no longer afford to remain in their hometown, by implementing rent control rules.

Tackling Gentrification and Affordable Housing

To combat the underlying factors that lead to these housing challenges, Brugada’s administration has also committed to building more affordable housing units throughout the city. This part of the plan focuses on the neighborhoods hardest hit by the changes, where real estate development has often led to long-time residents being pushed out. Neighborhoods like the Roma, Condesa, and Polanco, long accessible to the working class in Mexico City, have some of the world’s most congested neighborhoods because of gentrification, with wealthy foreigners seeking trendy foreign climes in the mix.

“The construction of more affordable housing will preserve the nature of my neighborhood,” Brugada stated. “We need to make sure the city’s culture remains protected, and that its people can continue to flourish.”

But the plan does not end there. Brugada is also concentrating on curtailing short-term rentals, now a key factor in the city’s housing crisis, on platforms such as Airbnb. Now, tourists and digital nomads book them, another incremental step in making it difficult for locals to rent an apartment in the city, which has seen an explosion in short-term rentals on par with that of New York and Paris. According to Brugada’s proposal, such rental platforms need to be regulated more tightly in a way that a balance between the rights of tenants and the obligations of landlords is better maintained and local communities are not be displaced.

The Global Issue of Overtourism

Mexico City’s move speaks to a larger phenomenon in cities around the world. Protest movements on gentrification occur around much of Europe, in Spain, Greece, Portugal and Germany, particularly in cities where there are popular holiday destinations. An army of digital nomads, however, arrived chasing low living costs, and there’s now a wide chasm between locals and tourists.

In Mexico, the situation became more dire when the country turned into a playground for tourists following the COVID-19 outbreak. Thousands of other digital nomads traveled to Mexico City with fewer travel restrictions and easy living, driving up prices for locals even more. The previous mayor and current president, Claudia Sheinbaum, signed deals in 2022 with entities such as Airbnb and UNESCO to promote tourism, specifically aiming to attract remote workers. The deals brought new revenues into the city — but also gentrified neighborhoods that had been affordable for decades, prompting long-term residents to leave because they could no longer afford to stay.

Rising Resentment and Demands for Action

Even as those of us who are from Mexico City experience the impact of the housing crisis, resentment of foreign tourists and digital nomads has also expanded. Isabel Toporek, 30, who lives in Colonia Escandón, said she was fed up with the rising cost of living that she said the foreigners were causing. Although she is not opposed to foreigners per se, she worries about the cost of everyday life since they arrived.

“I’m not angry at foreigners,” Toporek said. “But, when beers and wines skyrocket in price and the price of everything else normal increases, I can’t help but wonder. The prices in these neighborhoods need to stay stable.”

Other residents, such as Emiliana Rey Maza, 16, have proposed more drastic actions, including taxing tourists or creating a visa system to get a handle on the flow of foreign visitors and alleviate the economic pressure they are putting on the city.

“We are paying more for other people to be here,” Maza said. “Making them contribute, too, perhaps in the form of a tax or a visa system, is only fair. It’s a matter of fairness.”

What’s Next: A Solution on the Wayoulouse

Though Brugada’s plan is still in its infancy, it heralds a dramatic departure for Mexico City in how it fights gentrification and its growing housing crisis. The city’s government is consulting heavily on the details of the proposal, and will be seeking out the opinions of local communities, landlords and other stakeholders to inform the final policies, they said.

The Mexico City model could offer a blueprint for other cities struggling with the same problems. The current wave of gentrification, spurred in part by tourism and digital nomads, is not something new to Mexico, nor even that distinctly Mexican, but has proven to be yet another global phenomenon that many cities are trying to swallow. If successful, the policies implemented by Mayor Brugada may serve as a model for how the demands of locals must be balanced with the need to keep cities accessible and bustling.

These measures are only a starting point for Mexico City. As tensions flare and protests continue, those who live here hope the new policies will bring substantial changes that make the city a place in which everyone can live, not just the wealthiest transplants. The fight against gentrification is far from over, but for now, Mexico City is taking a few steps down a more inclusive path.

(Source: Mexico City Government, Mexico News Daily, Clara Brugada’s Office)