Property crisis on Crete and in Greece: Are Airbnb, Golden Visas and expats driving up rents?
Property crisis on Crete and in Greece: Are Airbnb, Golden Visas and expats driving up rents?
Table of Contents
Why Recent Measures on Short-Term Rentals and Golden Visa Are Insufficient
The recent regulations regarding short-term rentals and the Golden Visa programme are viewed as inadequate in addressing the housing crisis in Greece. These measures were implemented under the premise that they are contributors to the rising rental prices. However, experts indicate that these factors will not significantly reduce the existing shortage of available rental properties or alleviate the exceptionally high rental rates. The core issue lies in the lack of investments aimed at primary residences since 2010.
The available data highlights that the Golden Visa programme, which has issued fewer than 20,000 permits from 2018 to 2024, predominantly caters to high-income individuals in major urban areas. This focus exacerbates the situation, as a large portion of the housing supply is targeted at wealthier buyers, both local and international. Furthermore, with new EU directives potentially requiring homeowners to improve the energy efficiency of properties, there may be an adverse effect on the already limited availability of affordable housing for younger generations.
Deterioration of Primary Residence Supply Since 2010
Since 2010, there has been a marked decline in the supply of primary residences in Greece. This period has witnessed a significant reduction in residential construction, resulting in a chronic shortage of homes for those seeking long-term rental options. The lack of new housing developments has directly contributed to the escalating rental prices observed across major cities such as Athens and Thessaloniki.
The decrease in construction is a response to various economic challenges, including limited investment funding and a slow recovery from the financial crisis. Many potential investors remain hesitant due to the perceived risks associated with property investments. Consequently, this has led to rising competition for the limited housing stock, driving rents even higher. As a result, a growing number of younger individuals and families face difficulties in securing affordable rental accommodation.
Need for a Dedicated Housing Policy Agency
To effectively address the housing crisis, the establishment of a dedicated agency focused on housing policy is essential. This body would be responsible for devising and implementing strategies aimed at increasing the availability of affordable homes. It could coordinate efforts to attract investment in residential development and promote long-term rental solutions.
This proposed agency should also engage with existing homeowners, providing incentives such as financial support for renovations that could facilitate the transition from short-term to long-term rentals. By creating a structured approach to tackling housing availability, the government could better respond to the challenges posed by the increasing demand for affordable living spaces, thereby contributing positively to the overall stability of the Greek economy.
Frequently Asked Questions
How have short-term rental platforms influenced access to affordable housing in cities?
The rise of platforms like Airbnb has made more properties available for short-term rentals. This has often led to a reduction in long-term rental options. As a result, many residents find it harder to secure affordable housing in urban areas where demand for short-term stays increases prices and decreases availability.
What effects do residency-by-investment programmes have on local property markets?
Residency-by-investment initiatives, such as the Golden Visa, often drive up property prices in desirable locations. Investors buy properties not for personal use but as investments for citizenship. This can create a competitive market that locals may struggle to navigate, leading to rising costs and fewer options for residents.
Can government actions in the housing sector help solve issues linked to short-term rentals?
Governments may implement regulations aimed at curbing the impact of short-term rentals. Such actions could include caps on the number of days a property can be rented or requirements for permits. These measures may help balance the housing market, making it easier for locals to find affordable long-term housing.
What initiatives are in place to support fair development in light of increased property investment for citizenship?
Authorities are exploring policies that seek to balance the needs of investors with those of local residents. This includes monitoring the effects of property investments on housing supply and developing guidelines that ensure housing remains accessible for those who live and work in the area.
How does the increase in short-term rentals relate to homelessness and displacement in major urban centres?
Research indicates a correlation between the growth of short-term rental listings and rising homelessness rates in popular cities. The conversion of long-term rentals into short-term housing can displace residents, pushing lower-income individuals out of their communities and exacerbating the housing crisis.
In what ways do citizenship schemes affect the availability of long-term rental properties?
Citizenship schemes that encourage foreign investment can lead to a decrease in the number of properties available for long-term rentals. Investors purchasing homes for residency purposes may choose to leave these properties vacant or use them for short-term rentals, limiting choices for local renters and driving up prices.
