Digital Nomads and Cost of Living
This article is in partnership with Day Translations.
It would be unfair to put the blame entirely on digital nomads who work and travel to different countries for the current cost of living crisis. In fact, the cost of living has increased all over the world for a number of reasons which are mainly linked to macro-economic factors and decisions taken by individual national governments.
For example, digital nomads have been accused of influencing a rise in the price of houses and flats to rent for short periods of time as well as the lack of availability of housing for the local population. However, they are simply using some facilities and they are not part of the issues of a country’s lack of housing stock or they are mostly not the external investors that have purchased multiple properties to rent out at a high cost.
Housing is such a complex issue and in the past few years governments have launched a series of initiatives to incentivise private ownership of properties to rent, for example by offering favourable tax breaks.
Looking at Ireland, in particular, the boom of private investors in the housing market due to advantageous tax schemes has created a chronic lack of available homes that have are affordable for individuals and families.
This means that places like Lisbon in Portugal are no longer coveted by digital nomads, due to a change of direction in policies and also of public sentiment towards visitors, tourists and expats. Other countries are attracting the attention of digital nomads, including Sweden, Italy and The Netherlands.
Latvia, Estonia and Croatia are also popular choices, offering not only a relatively low cost of living but also good amenities ranging from wellness centres to ski resorts.
The Czech Republic is also on remote workers’ radar since it introduced a digital nomad visa.
The Number of Digital Nomads Is On the Rise
It has been calculated that by 2030 the total number of digital nomads worldwide will total 60 million people. Previously, the overall number of digital nomads in 2023 was estimated at 40 million, so this is a considerable increase.
While some people point the finger at digital nomads’ carbon footprint, in reality they don’t take too many flights, often preferring trains and buses to move from a place to another, which is also often cheaper. The argument against digital nomads and the criticism against them for contributing to climate change is based on the assumption that the average person or family takes only one holiday per year compared to digital nomads who do multiple trips in a year.
Many digital nomads choose to spend time in one country for a few months, making sure they build connections, understand local customs and, most importantly, learn the local language. Of course there are communities of digital nomads that live completely secluded from the locals and that’s their choice. Probably living in co-working hubs may contribute to the sense of seclusion as digital nomads hang out with one another within one building, but in the big scheme of things this type of accommodation that is marketed especially to digital nomads provides a solution to the housing crisis as in theory other properties are available to locals to rent and buy. The flipside to co-working hubs is that sometimes they use historic city centre properties because they are easier to access for international visitors, which means that city centres become unaffordable to live in for local people.
The real issue is investment companies owning several properties to rent out, as they have huge power and influence. If digital nomadism as a phenomenon were to go out of fashion, these companies would simply pivot and re-brand their properties for a different market.
Ultimately, this problem is something that individual governments need to tackle with appropriate legislation.