Economics 101

The real world is dictated by supply and demand. When demand is high and supply is low, prices rise as competition pushes them up. The increase in housing prices is a huge incentive for developers to build new housing. And it also increases the capital necessary to build more housing. Obviously the political situation will need to allows for new housing. Otherwise prices will just continue to increase.

No, the real world is affected by supply and demand, not dictated by it. The real world is dictated by a complex network of social and political pressures, each trying to achieve their own agenda, finding the balance in this environment in how to minimise damages while maximising benefits is the game that any government and, to a lesser extent, corporations try to play.

Believing that the world is dictated by a reductionist model of supply-and-demand is either myopic or ignorant, the world doesn't work like that, that is a model that works well for a diverse set of markets, not all and not at all if you start to include the social aspects into it.

You can't just start building anywhere and anything, that will kill cities, it's a shallow analysis of a broader scope of issues such as: maintaining livable conditions (as defined by the society and culture of that city, not by some metric of "available units per inhabitant"), maintaining harmony of urban planning, maintaining the cityscape, and so on. Devising the master plan for building is exactly the kind of aspect that a simplified worldview of pure supply-and-demand does not take into account, it's simplistic and unempathetic.

Prices will continue to increase if building new units doesn't take place. AirBnB and greedy landlords shouldn't have the power to increase this damage for short-term profits. And worse: doing that in a rent-seeking way, with little to no benefit to the society of that city apart from some tourism money and "digital nomads" income passing by, rent-seeking behaviour is disgusting, it's pure extraction by virtue of you accumulating enough capital to be able to own a piece of land, that's all, there's no productivity increase for society through this form of extractivism.

I don't think you understand what "rent seeking" actually means.

The NIMBY'ism of preventing new housing is the very definition of rent seeking. By legally locking in, the existing owners prevent others from entering the market due to artificially constrained supply. Airbnb doesn't create the demand; they are just a marketplace and one of many.

"Rent seeking (or rent-seeking) is an economic concept that occurs when an entity seeks to gain added wealth without any reciprocal contribution of productivity."

What contribution to productivity do corporations or people who have enough spare cash to buy available land provide to a society?

AirBnB can be just a marketplace, that doesn't mean it isn't damaging to society at large. Excluding the moral aspects of that is an ideology based on capitalism, it doesn't mean it's right.

Then why is that not happening? When your theory postulates some conclusions and those conclusions don't verify, then your theory is wrong? At least that's how it works in every science.

Is the Lisbon political situation allowing new construction? It's the political situation in the Bay Area (California) that's keeping prices high by not allowing new construction.

It's the same reason developer salaries are high. Demand is high and supply is (currently) low. My company is struggling to find people to hire right now and are offering cash incentives.