Greek PM Kyriakos Mitsotakis has announced a strategic package of six measures designed to tackle the deepening housing crisis. Speaking in Parliament ahead of the 2026 budget vote, Mitsotakis emphasized that the initiative aims to increase the supply of affordable homes and curb the rapid rise in property prices, which have now surpassed pre-debt crisis levels.
The core of the strategy focuses on three pillars: fiscal incentives, regulatory shifts, and direct subsidies.
1. Tax Incentives for Long-Term Rentals
To stimulate private investment, the government is introducing a significant tax break for developers.
The Incentive: Rental income will be tax-deductible for owners who build new units or renovate older buildings, provided the properties are placed on the long-term rental market for at least 10 years.
2. Streamlined Commercial-to-Residential Conversions
Starting in 2025, the government will simplify planning regulations to fast-track the conversion of vacant offices, warehouses, and industrial sites into housing.
Golden Visa Link: These converted properties will qualify for Greece’s “Golden Visa” program at a lower investment threshold, though they are strictly prohibited from being used as short-term holiday rentals.
3. Curbs on Short-Term Rentals (Airbnb)
Building on restrictions in central Athens, the government is extending the ban on new short-term rental registrations (AMA) to central Thessaloniki.
Ownership Clause: Properties sold or transferred will automatically lose their existing registration numbers, forcing new owners toward the long-term rental market.
4. €400 Million Renovation Subsidy
A massive renovation program targeting old and vacant homes will launch in 2026.
Coverage: Up to 90% of costs (capped at €36,000 per property).
Eligibility: Priority is given to vacant homes, with income caps set at €35,000 per couple (plus allowances for children).
5. Support for Public Sector Personnel
To assist essential workers stationed away from home, the government will provide a “rent refund” equivalent to two months’ rent annually for teachers, doctors, and nurses. Additionally, funds will be allocated to refurbish municipal buildings in remote regions specifically to house public employees.
6. Shifting the Construction Focus
Mitsotakis stated that the overarching goal is to pivot the construction industry away from “luxury-only” developments. By providing these incentives, the state hopes to redirect capital toward housing that is accessible to the broader Greek population.
The Greek housing crisis
Greece is currently grappling with one of the most severe housing affordability crises in the European Union. Over the last five years, rental prices in major urban centers like Athens and Thessaloniki have surged by as much as 40%, with property sale prices officially surpassing their pre-2008 debt crisis peaks.
This “artificial scarcity” is driven by a combination of factors: roughly 793,000 properties sit vacant or “parked” due to legal entanglements from non-performing loans, while thousands of others have been converted into high-yield short-term rentals via platforms like Airbnb.
The social impact has been profound, particularly for younger Greeks and low-to-middle-income families. Recent data shows that Greek households now face the highest housing cost burden in Europe, with nearly one in three citizens spending more than 40% of their disposable income on housing—more than double the EU average.
With homeownership rates falling and new construction starts significantly slowed by rising material costs, the government’s latest measures represent an urgent attempt to rebalance a market where demand for affordable living has long outstripped available supply.
Related: European Commission Unveils Strategy to Address the Housing Crisis