Report by Thanos Kamilalis

Speaking at the Thessaloniki International Fair (TIF), the Prime Minister announced several initiatives aimed at easing housing challenges, including:

  • The launch of the “My House II” programme, a €2 billion scheme providing low-interest loans to over 15,000 young individuals and couples under 50 years of age.
  • A €400 million programme offering zero-interest loans for home energy upgrades.
  • A temporary exemption from rent tax for landlords who rent previously vacant properties or convert short-term rentals into long-term leases.
  • A higher fee for contracts through short-term rental platforms.
  • A one-year ban on new licences for short-term rentals in three “saturated” areas of central Athens.

However, the effectiveness of these measures remains in question. Previous efforts, such as My Home I and the increase in the Golden Visa threshold, have failed to curb soaring housing costs. Greece continues to lead the EU in terms of housing expenses relative to income.

“Too little, too late”

Vassilis Delis, political scientist and scientific associate at the ENA Institute for Alternative Policies, recently published an analysis advocating a “new housing model” for Greece, focusing on the country’s growing “renter generation.” Delis notes that the proportion of renters has steadily risen, now accounting for over 30% of the population, with 40.5% of them spending more than 40% of their income on rent.

“In recent years, housing has emerged as one of the most pressing issues facing Greek society,” he notes in his analysis. “Conversations, particularly among young people, frequently touch on housing-related experiences. Often, these stories are both tragic and absurd—situations where the quality of available housing doesn’t match its skyrocketing price. Many have faced eviction due to an inability to meet loan repayments, while others are forced out as rent prices surge or properties are converted into short-term tourist rentals.”

Commenting on Mitsotakis’ TIF announcements, Delis dismissed the measures as “too little, too late.” He criticises the absence of rent control in exchange for tax exemptions, allowing landlords to continue operating freely in an unregulated market. He also argued that banning new Airbnb permits in saturated areas does little to alleviate the overall burden of short-term rentals. “The Barcelona model, for instance, goes further by not only restricting new licences but also setting a cap on the total number of short-term rental permits,” Delis said.

In its analysis, ENA points to cities like Paris, Amsterdam, and Lisbon, where strict controls have been implemented on short-term rentals. The report calls for more radical interventions, such as geographical zoning and a ban on legal entities engaging in short-term rentals.

The plight of students and renters

Students, among those hardest hit by Greece’s housing crisis, have organised protests, accusing the government of neglect. The recently announced increase in housing allowance only applies to students at universities outside Athens and Thessaloniki, which protesters describe as woefully inadequate. “They are mocking us with a housing allowance increase that benefits only a few,” student unions said. “Rents for small apartments now exceed €400-500, while the allowance equates to just €125 a month.”

Social housing: A forgotten solution

The government’s new “My Home 2” programme, according to Delis, fails to tackle the root causes of the housing crisis. Rather than using EU recovery funds to expand social housing, the government is offering bank-subsidised interest rates, leaving out those who already struggle to meet strict lending criteria.

Delis notes that Greece currently has no structured plan for social housing, following the closure of the Workers’ Housing Organisation (OEK) in 2012. While the prime minister announced a pilot project to create social housing on the site of the former CHROPEI factory, it remains a small-scale effort in the face of a widespread housing shortage.

“Other European countries, regardless of their economic ideology, have increased their stock of social housing to offer affordable alternatives,” said Delis. “Instead, Greece is funnelling €2 billion to the banks, despite the fact that it’s banks themselves that have restricted access to homeownership for so many.”

The government’s mixed priorities

One of the more controversial measures the government has proposed is the introduction of a tenant register, aimed at identifying “non-paying” tenants. This measure has sparked outrage among housing advocates, who accuse the government of blaming tenants for the crisis rather than addressing structural issues. “This is not seen in international best practices. How can a measure targeting people who can’t afford rent solve the housing crisis?” Delis asked.

According to the latest data from ELSTAT, nearly half (47.3%) of Greek households now face difficulties in paying rent, loan instalments, or bills, a sharp increase from 29.1% in 2022. With more people finding themselves unable to meet basic needs, housing affordability has become a central issue.

A new approach to housing

Delis and the ENA Institute advocate a radical overhaul of Greece’s housing policy, calling for a comprehensive approach that includes:

  • Quality standards for housing
  • Limits on annual rent increases
  • A ban on Golden Visas for residential purchases
  • Restrictions on short-term rentals based on geographical zones
  • The development of public and social housing through vacant public properties
  • New frameworks to support non-profit housing cooperatives
  • Financial incentives to bring vacant homes onto the long-term rental market
  • Creation of student residences to accommodate at least 25% of students at each institution
  • Favourable mortgage terms for first-time homebuyers
  • Reinstatement of protections for primary residences.

“The housing market must be regulated,” Delis insists. “We need to break the misconception that homeownership is entirely above market control. Housing should not be a free-for-all, where landlords set any price for substandard living conditions.”

Without these changes, Delis warns, the housing crisis will only deepen, with Greece’s “renter generation” bearing the brunt of the consequences.

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