Athens, Greece. Eirini Syntihaki said she is leaving an apartment she loved in central Athens after her flatmate moved out and the owners’ lawyers said they planned to raise the rent, which was already 700 euros. She said the rent was nearly her entire earnings and she is moving in with her sister.
Rent pressure amid economic rebound
Greece’s economy is rebounding sharply from its 2009-2018 financial crisis, with growth outstripping the EU average, bailout loans being repaid ahead of schedule and tourist visits at a record high. Amid the recovery, many Greeks are being left behind as rents soar and earnings fail to keep pace, forcing them to reduce spending on items such as heating, entertainment or dining and take on more debt, which experts said is creating a drag on the recovery.
Household finances and the middle class
Greece’s Small Enterprise Institute (IME), a confederation of small businesses, said in a report that “income adequacy is at a record low, with six out of ten households reporting that their monthly income does not reach the end of the month.” The institute said economic difficulties are no longer limited to low incomes but are extending to the middle classes.
Construction freeze and housing shortage
Many of the problems stem from the crisis years, when housing construction froze. A Piraeus Bank (BOPr.AT) report last year said there is a shortage of 180,000 houses for rent or sale in big Greek cities.
Golden visas and short-term rentals
The golden visa program available since 2014 for foreigners who buy property has exacerbated the shortage. Since the mid-2010s, 20,000 properties, mainly in Athens, have been sold to foreigners, according to Migration Ministry data, and another 150,000 have been converted to short-term rentals for tourists.
High demand for rentals
Themistocles Bakas, president of E-Real Estate Network, which has offices across Greece, said rental demand is so high that hundreds of people appear for one rental viewing.
How has rising rent affected your household budget?