Why Greece’s housing crunch is about empty homes, Airbnb and misplaced investment — and what it means for buyers

Greece’s housing market is getting harder to buy into — and the IMF says it’s not just a shortage

The IMF’s 2026 “Greece: Selected Issues” report lays out a stark message: the real estate Greece market is in the middle of a serious affordability crisis driven less by a shortfall in the number of homes and more by how properties are used and who controls them. Prices and rents have climbed at rates that far exceed income growth, while a surprisingly large share of the housing stock is idle, vacation-only, or tied to short-term rental platforms.

That diagnosis matters for anyone buying property, investing in Greek real estate, or planning to live and work in Greece. We read the IMF report line by line and offer practical takeaways for buyers and investors, plus an assessment of the policy tools under discussion.

What the IMF found: raw facts you need to know

The report compiles data that should unsettle policymakers and market participants alike.

• Asking prices rose by about 85% since 2017.
• Disposable income per person increased by 47% over the same period.
• Home prices jumped by 61% since Q4 2020.
• Rent inflation reached 10% in 2025.
• Short-term rental listings increased by 240% between 2017 and 2024 — from under 100,000 to more than 230,000. That is roughly 3.5% of the total housing stock, 10% of non-occupied properties, and 29% of vacant homes.
• Around 35% of Greece’s housing stock is not used as a main residence, and about 12–13% of homes are vacant.
• Two in five households spend more than 40% of disposable income on housing, and another 20% spend between 30% and 40%.

Those numbers show a market where headline supply figures mislead. On paper Greece has lots of housing, but much of it is off the table for long-term residents.

Why prices and rents have outpaced incomes

There are three interacting forces driving the squeeze on affordability.

1. Supply allocation and the profile of housing stock

Greece has a high housing stock per capita compared with other European countries, but the stock is heavily skewed toward second homes, seasonal properties, or units that need costly renovation. Many units are old, energy inefficient, tied up in co-ownership or inheritance disputes, or legally complex to sell or rent long term. In practical terms, suitable, habitable, and affordable homes in high-demand areas are scarce.

2. Short-term rentals and tourism demand

The rapid expansion of short-term rentals is concentrated in exactly the places where local housing demand is highest: tourist islands, central Athens and Piraeus, and popular parts of Thessaloniki. The IMF links higher concentrations of short-term rentals with rising sale prices, particularly in areas with low homeownership rates. Short-term listings are now more than 230,000, and their growth was strong enough to alter local markets.

3. Foreign investor demand and policy incentives

Foreign buyers and diaspora investors returned after the financial crisis when prices were depressed, attracted by anticipated capital gains and tax incentives, including the Golden Visa scheme. While minimum investment thresholds were recently raised, regulatory shifts have at times triggered bursts of buying as investors sought to qualify under more favourable terms.

Short-term rentals: economic benefit or structural problem?

The IMF is candid that short-term rentals support tourism revenue, local services and income for property owners. They are not the villain in every case. But the report also shows how they compress supply for long-term tenants in key local markets and correlate with higher sale prices.

Key points:

• Short-term rentals now account for 3.5% of total housing stock nationally, but in tourist hotspots the market share is much higher.
• The concentration of these units overlaps with areas that already have low rates of owner occupation, amplifying price pressure.
• The IMF warns that restricting short-term rentals is not an automatic fix because many vacant units are second homes or seasonal houses; owners may not convert them into long-term rentals even if short-term platforms are limited.

My view: policymakers should treat short-term rental policy like urban planning rather than a tourism tax. Targeted, well-enforced rules in the places where inventory is tight are preferable to blanket bans that shift demand to adjacent towns and harm legitimate local businesses.

Empty homes are a policy problem, not a mystery

One of the report’s most counterintuitive findings is that Greece’s core problem is allocation, not absolute scarcity. With about 12–13% vacancy and 35% of stock not intended for primary residence, there is a large potential pool to tap — but unlocking it will not be simple.

Barriers include:

• Physical condition: many units need renovation and energy retrofits to meet modern living standards.
• Ownership complexity: co-ownership, inheritance chains, non-resident owners or legal encumbrances slow conversion to market housing.
• Financial calculation: owners of second homes may prefer to leave units idle, use them seasonally, or hold them for capital gains rather than sign long leases.

The IMF recommends a mix of incentives and disincentives: renovation subsidies, energy-efficiency grants, tax breaks for long-term rentals and measures that increase the cost of leaving properties vacant in high-demand zones. They also highlight the need for administrative reforms like faster dispute-resolution mechanisms and a tenant registry to reduce landlord risk.

What the IMF recommends and how realistic those measures are

The Fund’s policy menu is practical but politically sensitive. Core proposals include:

• Incentives for renovation and energy efficiency to make empty units habitable and cheaper to run.
• Tax incentives to encourage long-term leasing rather than short-term rentals.
• Measures to raise the cost of vacancy in high-demand areas, which could mean higher taxes or levies on unused homes.
• Reducing landlord risk through a registry, expedited dispute resolution, and rent guarantee schemes for vulnerable tenants.

Real-world constraints:

• Renovation subsidies cost public money and require careful targeting to avoid windfalls for owners who would have renovated anyway.
• Vacancy taxes can be evaded unless authorities have accurate registers of ownership and residency status.
• Rent guarantee schemes and faster courts demand institutional capacity that Greece must build or fund.

I believe a phased package that pairs carrots and sticks is the most credible route. Start with pilot programs in Attica and major tourist municipalities where the data show the greatest mismatch between vacant stock and demand.

Practical guidance for buyers and investors

If you are considering property Greece now, here is how to think about risk and opportunity.

What to watch for:

• Location matters more than ever. Attica (Athens), Thessaloniki and prime islands show the strongest price gains and also the most regulatory scrutiny.
• Regulatory risk is real.