This paper provides a critical socio-economic evaluation of the contemporary housing crisis in Southern Europe, focusing on the urban ecosystem of Portugal. Over the past decade, metropolitan areas such as Lisbon and Porto have undergone rapid restructuring driven by global real estate financialization, transnational capital inflows, and tourism-led gentrification. Grounded in urban sociology and political economy, this study examines how state-led incentive programs—specifically the Golden Visa regime, the Non-Habitual Resident (NHR) tax framework, and short-term rental deregulations—transformed housing from a fundamental social right into an asset class for global investment. Utilizing an institutional and legislative analysis, the paper evaluates the socio-spatial impacts of these policies on urban inequality, residential displacement, and generational immobility. It further assesses the efficacy of recent legislative interventions, notably the Mais Habitação (More Housing) policy package. The study concludes by proposing an integrated public housing framework aimed at restoring residential stability and constitutional housing guarantees.