Recently, the Greek government has introduced new regulations in an attempt to make housing more affordable for citizens. From rule changes to the golden visa to restrictions on short-term rentals, here’s what you need to know.
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The boom of Airbnb in Greece
Airbnb is a hit in Greece…
In the last few years, Airbnb has grown rapidly in Greece. According to Agrophilia, in 2019, there were 653,000 available beds nationwide Rhodes saw an increase of 67% rental beds in this period. By 2023, this number had risen to 962,000. Crete, the Cyclades and the Ionian islands have seen the greatest increase. In 2019, the average rental price was €122 and in 2023, €191 – an increase of 57%.
While short-term rentals are a strong source of income for the Greek economy, critics say that they are feeding the issue of unaffordable housing.
At the start of the year, the Greek government announced:
- If you rent out one or two properties, you must pay an accommodation fee (€1.50 per booking).
- If you rent out three or more properties, this is classed as a business activity. You must pay 13% VAT and taxes and fees of a hotelier.
- Stays of longer than 30 days can no longer be booked through Airbnb and are classed as a long-term rental.
The Greek government has stressed that new regulations are aimed at those that have turned short-term rentals into a commercial venture rather than those making extra income from one or two homes.
But new regulations and initiatives are being considered:
- A two-tier tax system: tax deductions for long-term rentals, higher taxes for short-term rentals.
- Limiting the lease duration to 90 days per year (60 for islands with less than 10,000 residents). However, exceptions will be made if the annual income is below €12,000 per year.
- Local authorities could be given more power to crackdown on short-term rentals, at their own discretion.
Golden visa rule changes
Properties purchased through the golden visa will no longer be eligible for short-term rentals.
The golden visa is a residency-by-investment scheme that allows third-country nationals to stay in the country beyond 90 days when they purchase a property. Since Brexit, Britons have only been able to spend 90 days out of every rolling 180 within the Schengen Area. With a golden visa, you are able to travel freely in Greece and the rest of the Schengen Area.
Several countries have had a golden visa, but they have been under scrutiny for a while. The Portuguese golden visa has changed dramatically, the Spanish one has been axed.
Each golden visa had a minimum investment requirement. Greece’s golden visa was particularly sought after because it had a minimum investment requirement of just €250,000. However, last year, that was raised to €500,000 in Attica, Mykonos, Santorini and Thessaloniki. From the end of August, those areas will now require a minimum spend of €800,000 to qualify for the golden visa. In the rest of the country, the minimum spend of €250,000 will be raised to €400,000. Whether the spend is €400,000 or €800,000 is dependent on the area’s housing demand and population size.
Additionally, the Greek government has decided that properties purchased through the golden visa scheme will no longer be eligible to be rented out as a short-term rental.
What does this mean for my Greek property plans?
Act quickly…
For those still hoping to get a Greek golden visa under the previous minimum spend requirement, the window of opportunity is narrowing. If you want to do so, you have until the end of September to put down 10% on a property and complete by the end of 2024. In the last 12 months, the number of residence permits for Britons has increased by 58%.
Choose a different island
For some, it might just be a case of shifting your property plans from Mykonos to one of the lesser-known islands to qualify for a golden visa at a less steep spend requirement. 227 of Greece’s islands are habited.
Investigate your visa options
Dependent on your circumstances, Greece still has many fantastic visa options. If you would like to live and work there for an overseas company, you may be interested in the digital nomad visa. Alternatively, if you are retired, the non-lucrative visa might suit.
Talk to experts
In terms of short-term rentals, while there may be more restrictions in future, it is still possible. Whatever your plans, it is best practice to chat to your estate agent and lawyer to check that they are legally sound and can go ahead. Connect with Greek property experts now.
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